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                    CONVERTIBLE DEBENTURE PURCHASE AGREEMENT

                                      Among

                            DIRECT INSITE CORPORATION

                                       and

                         THE INVESTORS SIGNATORY HERETO




                         Dated as of September 27, 2000





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<PAGE>

     CONVERTIBLE  DEBENTURE PURCHASE AGREEMENT (this  "Agreement"),  dated as of
September 27, 2000,  among Direct  Insite  Corporation,  a Delaware  corporation
(formerly known as Computer  Concepts Corp.) (the "Company"),  and the investors
signatory  hereto (each such  investor is a "Purchaser"  and all such  investors
are, collectively, the "Purchasers").

     WHEREAS,  subject to the terms and  conditions  set forth in this Agreement
and  pursuant to Section  4(2) of the  Securities  Act of 1933 (the  "Securities
Act"),  as amended,  the Company desires to issue and sell to the Purchasers and
the  Purchasers,  severally  and not  jointly,  desire,  over the period of time
described  herein,  to purchase from the Company,  up to an aggregate  principal
amount of $3,000,000 of the Company's 6% Convertible  Debentures,  due September
27, 2002, which shall be in the form of Exhibit A (the "Debentures"),  which are
convertible  into shares of the  Company's  common  stock,  $.0001 par value per
share (the "Common Stock").

     NOW, THEREFORE,  IN CONSIDERATION of the mutual covenants contained in this
Agreement,  and for  other  good and  valuable  consideration  the  receipt  and
adequacy of which are hereby acknowledged,  the Company and the Purchasers agree
as follows:


                                    ARTICLE I
                                PURCHASE AND SALE

     1.1  The Closing

          (a) The Closing.  (i) Subject to the terms and conditions set forth in
this  Agreement,  the  Company  shall issue and sell to the  Purchasers  and the
Purchasers shall,  severally,  and not jointly,  purchase from the Company, over
the period of time described  herein,  the Debentures for an aggregate  purchase
price of $3,000,000. The closing of the purchase and sale of the Debentures (the
"Closing") shall take place at the offices of Robinson Silverman Pearce Aronsohn
& Berman LLP ("Robinson Silverman"),  1290 Avenue of the Americas, New York, New
York 10104, immediately following the execution hereof or such later date as the
parties shall agree.  The date of the Closing is hereinafter  referred to as the
"Closing Date."

               (ii) On the  Closing  Date,  the parties  shall  deliver or shall
cause to be  delivered  the  following:  (A) the Company  shall  deliver to each
Purchaser:  (1)  Debentures  registered  in the  name of such  Purchaser  in the
aggregate  principal  amount of 2/3 of the purchase price  indicated  below such
Purchaser's name on the signature page to this Agreement,  (2) the legal opinion
of Blau, Kramer,  Wactlar & Lieberman,  P.C., outside counsel to the Company, in
the form of Exhibit C, (3) an executed Registration Rights Agreement,  dated the
date hereof, among the Company and the Purchasers, in the form of Exhibit B (the
"Registration  Rights Agreement"),  and (5) Transfer Agent Instructions,  in the
form of Exhibit D, delivered to and acknowledged by the Company's transfer agent
(the "Transfer Agent Instructions"), and (B) each Purchaser shall deliver to the
Company:  (1) 2/3 of the purchase price indicated below such Purchaser's name on
the signature  page to this  Agreement in United States  dollars in  immediately
available  funds by wire  transfer  to an account  designated  in writing by the
Company for such purpose, and (2) an executed Registration Rights Agreement.
<PAGE>
               (iii) On the 30th day  following  the Closing  Date or such other
date as the  parties  may agree (such 30th day,  the "First  Additional  Funding
Date"),  if each of the conditions listed in Section 3.14 hereof shall have been
either  satisfied  by the  Company or waived by the  Purchasers,  then:  (A) the
Company  will,  against  delivery of the amounts set forth in clause (B) in this
paragraph,  deliver to each  Purchaser,  Debentures in the  aggregate  principal
amount of 1/6 of the purchase price indicated below such Purchaser's name on the
signature page to this Agreement,  registered in the name of such Purchaser (the
"First  Additional  Debentures" which shall be included within the definition of
"Debentures")  , and (B) each Purchaser will deliver to the Company,  1/6 of the
purchase price  indicated below such  Purchaser's  name on the signature page to
this Agreement in United States dollars in immediately  available  funds by wire
transfer to an account designated in writing by the Company for such purpose.

               (iv) On the  earlier to occur of (x) the 60th day  following  the
Closing  Date  and (y) the  second  Trading  Day  following  the  date  that the
Underlying Shares  Registration  Statement (as defined herein) is filed with the
Securities and Exchange  Commission (the "Commission") or such other date as the
parties may agree (such earlier date, the "Second  Additional Funding Date"), if
each of the  conditions  listed in Section  3.15  hereof  shall have been either
satisfied  by the  Company or waived by the  Purchasers,  then:  (A) the Company
will, against delivery of the amounts set forth in clause (B) in this paragraph,
deliver to each Purchaser,  Debentures in the aggregate  principal amount of 1/6
of the purchase price  indicated  below such  Purchaser's  name on the signature
page to this  Agreement,  registered in the name of such  Purchaser (the "Second
Additional  Debentures"  which  shall  be  included  within  the  definition  of
"Debentures")  , and (B) each Purchaser will deliver to the Company,  1/6 of the
purchase price  indicated below such  Purchaser's  name on the signature page to
this Agreement in United States dollars in immediately  available  funds by wire
transfer to an account designated in writing by the Company for such purpose.

          1.2 Certain Defined Terms. For purposes of this Agreement, "Conversion
Price,"  "Original  Issue Date" and  "Trading  Day" shall have the  meanings set
forth in the  Debentures;  "Business  Day" shall  mean any day except  Saturday,
Sunday  and any day which  shall be a federal  legal  holiday  or a day on which
banking  institutions in the State of New York are authorized or required by law
or other  governmental  action to  close;  A  "Person"  means an  individual  or
corporation,  partnership,  trust,  incorporated or unincorporated  association,
joint venture, limited liability company, joint stock company, government (or an
agency or subdivision thereof) or other entity of any kind.


                                   ARTICLE II
                         REPRESENTATIONS AND WARRANTIES

     2.1 Representations and Warranties of the Company. The Company hereby makes
the following representations and warranties to the Purchasers:
<PAGE>
          (a) Organization and Qualification.  The Company is a corporation duly
incorporated,  validly existing and in good standing under the laws of the State
of Delaware with the requisite  corporate power and authority to own and use its
properties and assets and to carry on its business as currently  conducted.  The
Company  has  no  subsidiaries  other  than  as set  forth  in  Schedule  2.1(a)
(collectively the  "Subsidiaries").  Each of the Subsidiaries is an entity, duly
incorporated or otherwise organized, validly existing and in good standing under
the  laws  of  the  jurisdiction  of  its   incorporation  or  organization  (as
applicable),  with  the  requisite  power  and  authority  to own  and  use  its
properties and assets and to carry on its business as currently conducted.  Each
of the Company and the  Subsidiaries  is duly qualified to do business and is in
good standing as a foreign  corporation or other entity in each  jurisdiction in
which the nature of the business  conducted  or property  owned by it makes such
qualification necessary,  except where the failure to be so qualified or in good
standing, as the case may be, could not,  individually or in the aggregate,  (x)
adversely affect the legality,  validity or enforceability of the Securities (as
defined below) or any of this Agreement,  the Registration Rights Agreement,  or
the Transfer Agent Instructions (collectively, the "Transaction Documents"), (y)
have or result  in a  material  adverse  effect on the  results  of  operations,
assets,  prospects, or condition (financial or otherwise) of the Company and the
Subsidiaries, taken as a whole, or (z) adversely impair the Company's ability to
perform  fully on a timely basis its  obligations  under any of the  Transaction
Documents (any of (x), (y) or (z), a "Material Adverse Effect").

          (b)  Authorization;   Enforcement.   The  Company  has  the  requisite
corporate  power and authority to enter into and to consummate the  transactions
contemplated by each of the Transaction Documents and otherwise to carry out its
obligations  thereunder.  The execution and delivery of each of the  Transaction
Documents  by  the  Company  and  the  consummation  by it of  the  transactions
contemplated  thereby have been duly  authorized by all necessary  action on the
part of the Company and no further  action is required by the  Company.  Each of
the  Transaction  Documents  has been duly  executed  by the Company  and,  when
delivered in accordance  with the terms hereof,  will  constitute  the valid and
binding obligation of the Company  enforceable against the Company in accordance
with its terms. Neither the Company nor any Subsidiary is in violation of any of
the  provisions  of its  respective  certificate  or articles of  incorporation,
by-laws or other organizational or charter documents.

          (c) Capitalization.  The number of authorized,  issued and outstanding
capital  stock  of the  Company  is set  forth in  Schedule  2.1(c).  Except  as
disclosed in Schedule 2.1(c),  the Company owns all of the capital stock of each
Subsidiary.  No shares of Common  Stock are  entitled to  preemptive  or similar
rights, nor is any holder of securities of the Company entitled to preemptive or
similar rights arising out of any agreement or understanding with the Company by
virtue of any of the Transaction  Documents.  Except as a result of the purchase
and sale of the Debentures and except as disclosed in Schedule 2.1(c), there are
no  outstanding  options,  warrants,  script  rights to  subscribe  to, calls or
commitments of any character  whatsoever  relating to, or securities,  rights or
obligations convertible into or exchangeable for, or giving any Person any right
to  subscribe  for or  acquire,  any  shares  of  Common  Stock,  or  contracts,
commitments,  understandings,  or  arrangements  by  which  the  Company  or any
Subsidiary is or may become bound to issue additional shares of Common Stock, or
securities or rights convertible or exchangeable into shares of Common Stock.
 The  issue  and  sale of the  Debentures,  Warrant  or  Underlying  Shares  (as
hereinafter  defined)  will not  obligate  the Company to issue shares of Common
Stock or other  securities  to any Person other than the  Purchaser and will not
result in a right of any holder of Company  securities to adjust the exercise or
conversion or reset price under such securities.
<PAGE>
          (d) Issuance of the  Debentures.  The Company will have (and will,  at
all times while the Debentures are outstanding, maintain) an adequate reserve of
duly authorized shares of Common Stock,  reserved for issuance to the holders of
such  Debentures,  to enable it to perform its conversion and other  obligations
under this Agreement and the  Debentures.  Such number of reserved and available
shares of Common  Stock  shall not be less than the sum of  4,384,000  shares of
Common Stock for  issuance  upon  conversion  of the  Debentures  and payment of
interest  thereon in shares of Common Stock ( the "Initial  Minimum").  All such
authorized  shares of Common  Stock shall be duly  reserved  for issuance to the
holders of the  Debentures.  The shares of Common Stock issuable upon conversion
of the  Debentures  are  collectively  referred  to  herein  as the  "Underlying
Shares." The Debentures and the Underlying  Shares are collectively  referred to
herein as, the  "Securities."  When issued in accordance with the Debentures and
the Underlying  Shares will be duly authorized,  validly issued,  fully paid and
nonassessable.

          (e) No  Conflicts.  The  execution,  delivery and  performance  of the
Transaction  Documents by the Company and the consummation by the Company of the
transactions  contemplated  thereby  do not and  will not (i)  conflict  with or
violate any  provision  of the  Company's  or any  Subsidiary's  certificate  or
articles of  incorporation,  bylaws or other charter  documents (each as amended
through the date hereof),  or (ii) subject to obtaining  the Required  Approvals
(as defined  below),  conflict  with, or constitute a default (or an event which
with notice or lapse of time or both would become a default)  under,  or give to
others any rights of termination,  amendment, acceleration or cancellation (with
or without notice,  lapse of time or both) of, any agreement,  credit  facility,
debt or other instrument  (evidencing a Company or Subsidiary debt or otherwise)
or other  understanding  to which the Company or any Subsidiary is a party or by
which  any  property  or  asset of the  Company  or any  Subsidiary  is bound or
affected,  or (iii) result in a violation of any law, rule,  regulation,  order,
judgment,  injunction,  decree or other restriction of any court or governmental
authority to which the Company or a Subsidiary is subject (including federal and
state securities laws and regulations), or by which any property or asset of the
Company  or a  Subsidiary  is bound or  affected;  except in the case of each of
clauses (ii) and (iii), as could not, individually or in the aggregate,  have or
result in a Material  Adverse  Effect.  The business of the Company is not being
conducted in violation of any law,  ordinance or regulation of any  governmental
authority,  except for violations which, individually or in the aggregate, could
not have or result in a Material Adverse Effect.

          (f)  Filings,  Consents  and  Approvals.  Neither  the Company nor any
Subsidiary is required to obtain any consent, waiver, authorization or order of,
give any notice to, or make any filing or registration  with, any court or other
federal,  state,  local or other  governmental  authority  or  other  Person  in
connection  with the execution,  delivery and  performance by the Company of the
Transaction  Documents,  other than (i) the filings required pursuant to Section
3.10,  (ii) the filing with the Commission of a registration  statement  meeting
the requirements set forth in the Registration Rights Agreement and covering the
resale  of the  Underlying  Shares by the  Purchasers  (the  "Underlying  Shares
Registration Statement"), (iii) the application(s) to the Nasdaq Smallcap Market
("NASDAQ")  for the listing of the  Underlying  Shares for trading on the NASDAQ
(and with any other national  securities  exchange or market on which the Common
Stock is then listed) in the time and manner required  thereby,  (iv) applicable
Blue Sky  filings,  and (v) in all other  cases where the failure to obtain such
consent,  waiver,  authorization  or order,  or to give such notice or make such
filing  or  registration  could not have or result  in,  individually  or in the
aggregate, a Material Adverse Effect (collectively, the "Required Approvals").
<PAGE>
          (g) Litigation; Proceedings. There is no action, suit, inquiry, notice
of violation,  proceeding or  investigation  pending or, to the knowledge of the
Company,  threatened against or affecting the Company or any of its Subsidiaries
or any of  their  respective  properties  before  or by any  court,  arbitrator,
governmental or administrative  agency or regulatory authority (federal,  state,
county,  local or  foreign)  (collectively,  an  "Action")  which (i)  adversely
affects or challenges  the legality,  validity or  enforceability  of any of the
Transaction  Documents or the Securities or (ii) except as disclosed in Schedule
2.1(g),  could,  if there were an unfavorable  decision,  individually or in the
aggregate,  have or result in a Material Adverse Effect. Neither the Company nor
any Subsidiary,  nor any director or officer thereof, is or has been the subject
of any Action  involving a claim of violation of or liability  under  federal or
state  securities  laws or a claim of breach of fiduciary duty. The Company does
not have pending before the Commission any request for confidential treatment of
information  and the Company has no knowledge of any expected  such request that
would be made prior to the  Effectiveness  Date (as defined in the  Registration
Rights  Agreement).  There  has  not  been,  and to the  best  of the  Company's
knowledge  there  is not  pending  or  contemplated,  any  investigation  by the
Commission involving the Company or any current or former director or officer of
the Company.

          (h) No Default or  Violation.  Neither the Company nor any  Subsidiary
(i) is in default under or in violation of (and no event has occurred  which has
not been waived which,  with notice or lapse of time or both,  would result in a
default by the  Company or any  Subsidiary  under),  nor has the  Company or any
Subsidiary  received notice of a claim that it is in default under or that it is
in violation of, any indenture,  loan or credit agreement or any other agreement
or instrument to which it is a party or by which it or any of its  properties is
bound, (ii) is in violation of any judgment or order of any court, arbitrator or
governmental  body, or (iii) is in violation of any statute,  rule or regulation
of any governmental authority, in each case of clauses (i), (ii) or (iii) above,
except  as could  not  individually  or in the  aggregate,  have or  result in a
Material Adverse Effect.

          (i) Private Offering. Assuming the accuracy of the representations and
warranties  of the  Purchasers  set forth in  Sections  2.2(b)-(g),  the  offer,
issuance and sale of the Securities to the Purchasers as contemplated hereby are
exempt from the  registration  requirements of the Securities  Act.  Neither the
Company nor any Person acting on its behalf has taken or is, to the knowledge of
the Company,  contemplating  taking any action which could subject the offering,
issuance  or sale of the  Securities  to the  registration  requirements  of the
Securities  Act including  soliciting any offer to buy or sell the Securities by
means of any form of general solicitation or advertising.

          (j) SEC  Reports;  Financial  Statements.  The  Company  has filed all
reports required to be filed by it under the Securities Exchange Act of 1934, as
amended  (the  "Exchange  Act"),  including,  without  limitation,  all  filings
required  pursuant  to  Sections  13(a)  and  15(d)  thereof,  for the one  year
preceding the date hereof (or such shorter period as the Company was required by
law to file such material) (the foregoing materials being collectively  referred
to  herein  as the  "SEC  Reports"  and,  together  with the  Schedules  to this
Agreement, the "Disclosure Materials") on a timely basis or has received a valid
extension of such time of filing and has filed any such SEC Reports prior to the
expiration of any such extension.  As of their respective dates, the SEC Reports
complied in all material  respects with the  requirements  of the Securities Act
<PAGE>
and the Exchange Act and the rules and regulations of the Commission promulgated
thereunder,  and none of the SEC  Reports,  when  filed,  contained  any  untrue
statement of a material  fact or omitted to state a material fact required to be
stated therein or necessary in order to make the statements therein, in light of
the  circumstances  under which they were made,  not  misleading.  All  material
agreements to which the Company is a party or to which the property or assets of
the  Company  are  subject  have been filed as  exhibits  to the SEC  Reports as
required  under the  Exchange  Act.  The  financial  statements  of the  Company
included in the SEC Reports  comply in all  material  respects  with  applicable
accounting  requirements  and the rules and  regulations of the Commission  with
respect  thereto as in effect at the time of filing.  Such financial  statements
have been prepared in accordance with generally accepted  accounting  principles
applied on a consistent  basis during the periods involved  ("GAAP"),  except as
may be otherwise  specified in such  financial  statements or the notes thereto,
and fairly  present in all  material  respects  the  financial  position  of the
Company and its  consolidated  subsidiaries  as of and for the dates thereof and
the results of operations and cash flows for the periods then ended, subject, in
the  case  of  unaudited  statements,  to  normal,  immaterial,  year-end  audit
adjustments.  Since June 30, 2000 except as  specifically  disclosed  in the SEC
Reports, (a) there has been no event, occurrence or development that has or that
could result in a Material Adverse Effect,  (b) the Company has not incurred any
liabilities (contingent or otherwise) other than (x) liabilities incurred in the
ordinary  course of business  consistent  with past practice and (y) liabilities
not required to be reflected in the Company's  financial  statements pursuant to
GAAP or required to be disclosed in filings  made with the  Commission,  (c) the
Company has not altered its method of accounting or the identity of its auditors
and (d) the Company has not declared or made any payment or distribution of cash
or other property to its  stockholders  or officers or directors  (other than in
compliance with existing Company stock option plans) with respect to its capital
stock, or purchased, redeemed (or made any agreements to purchase or redeem) any
shares of its capital stock.

          (k)  Investment  Company.  The Company is not, and is not an Affiliate
(as defined in Rule 405 under the Securities  Act) of, an  "investment  company"
within the meaning of the Investment Company Act of 1940, as amended.

          (l)  Certain  Fees.  Except for  certain  consultant  fees  payable to
Spinneret  Financial Systems Ltd. by the Company, no fees or commissions will be
payable by the Company to any broker,  financial advisor or consultant,  finder,
placement  agent,  investment  banker,  bank or other Person with respect to the
transactions  contemplated  by this  Agreement.  The  Purchasers  shall  have no
obligation  with respect to any fees or with respect to any claims made by or on
behalf of other Persons for fees of a type contemplated in this Section that may
be due in connection with the transactions  contemplated by this Agreement.  The
Company  shall  indemnify  and hold harmless the  Purchasers,  their  employees,
officers, directors, agents, and partners, and their respective Affiliates, from
and  against  all  claims,  losses,  damages,  costs  (including  the  costs  of
preparation  and attorney's  fees) and expenses  suffered in respect of any such
claimed or existing fees, as such fees and expenses are incurred.
<PAGE>
     (m)  Solicitation  Materials.  Neither the Company nor any Person acting on
the Company's  behalf has  solicited any offer to buy or sell the  Securities by
means of any form of general solicitation or advertising.

     (n) Form S-3  Eligibility.  The Company is eligible to register  securities
for resale under Form S-3 promulgated under the Securities Act.

     (o)  Exclusivity.  The Company  shall not issue and sell  Debentures to any
Person other than the Purchasers  without the specific prior written  consent of
the Purchasers, which consent shall not be unreasonably withheld.

     (p) Seniority.  Except as disclosed in Schedule 2.1(p),  no indebtedness of
the  Company  is senior to the  Debentures  in right of  payment,  whether  with
respect to interest or upon liquidation or dissolution, or otherwise.

     (q) Listing and Maintenance Requirements Compliance. Except as set forth in
the SEC  Reports,  the  Company  has not,  in the two years  preceding  the date
hereof,  received notice (written or oral) from the NASDAQ,  any stock exchange,
market or trading  facility on which the Common  Stock is or has been listed (or
on which it has been quoted) to the effect that the Company is not in compliance
with the listing or maintenance requirements of such exchange, market or trading
facility. Except for the price maintenance requirement,  the Company is, and has
no reason to believe that it will not in the foreseeable  future continue to be,
in compliance with all such listing and maintenance requirements.

     (r) Patents and Trademarks.  The Company and its Subsidiaries have, or have
rights  to  use,  all  patents,  patent  applications,   trademarks,   trademark
applications,  service marks, trade names, copyrights, licenses and rights which
are necessary or material for use in connection with their respective businesses
as  described  in the SEC  Reports and which the failure to so have would have a
Material Adverse Effect  (collectively,  the  "Intellectual  Property  Rights").
Neither the Company nor any  Subsidiary  has received a written  notice that the
Intellectual Property Rights used by the Company or its Subsidiaries violates or
infringes  upon the rights of any Person.  To the best knowledge of the Company,
all such  Intellectual  Property Rights are enforceable and there is no existing
infringement by another Person of any of the Intellectual Property Rights.

     (s) Registration  Rights;  Rights of Participation.  Except as set forth on
Schedule 6(b) to the Registration Rights Agreement,  the Company has not granted
or agreed to grant to any Person any rights (including "piggy-back" registration
rights) to have any securities of the Company  registered with the Commission or
any other  governmental  authority which has not been  satisfied.  Except as set
forth on Schedule 6(b) to the Registration  Rights Agreement,  no Person has any
right of first refusal, preemptive right, right of participation, or any similar
right  to  participate  in the  transactions  contemplated  by  the  Transaction
Documents.

     (t)  Regulatory  Permits.  The  Company  and its  Subsidiaries  possess all
certificates,  authorizations  and permits  issued by the  appropriate  federal,
state or foreign  regulatory  authorities  necessary to conduct their respective
businesses as described in the SEC Reports,  except where the failure to possess
such permits could not,  individually  or in the aggregate,  have or result in a
Material Adverse Effect  ("Material  Permits"),  and neither the Company nor any
such  Subsidiary  has  received  any  notice  of  proceedings  relating  to  the
revocation or modification of any Material Permit.
<PAGE>
     (u) Title. The Company and the Subsidiaries  have good and marketable title
in fee  simple  to all real  property  owned by them  which is  material  to the
business of the Company and its  Subsidiaries  and good and marketable  title in
all  personal  property  owned by them which is material to the  business of the
Company and its Subsidiaries,  in each case free and clear of all Liens,  except
for Liens as do not  materially  affect  the value of such  property  and do not
interfere  with the use made and  proposed  to be made of such  property  by the
Company and its Subsidiaries.  Any real property and facilities held under lease
by the Company and its Subsidiaries are held by them under valid, subsisting and
enforceable  leases of which the Company and its  Subsidiaries are in compliance
and do not interfere  with the use made and proposed to be made of such property
and buildings by the Company and its Subsidiaries.

     (v) Labor Relations.  No material labor problem exists or, to the knowledge
of the Company, is imminent with respect to any of the employees of the Company.

     (w) Disclosure.  The Company  confirms that neither it nor any other Person
acting on its behalf has provided any of the Purchasers or its agents or counsel
with any information that constitutes or might  constitute  material  non-public
information.  The Company  understands and confirms that the Purchasers shall be
relying on the foregoing representations in effecting transactions in securities
of the Company. All disclosure provided to the Purchasers regarding the Company,
its business and the transactions  contemplated hereby,  including the Schedules
to this Agreement, furnished by or on behalf of the Company are true and correct
and do not contain any untrue  statement of a material fact or omit to state any
material fact necessary in order to make the statements  made therein,  in light
of the circumstances under which they were made, not misleading.


     2.2 Representations and Warranties of the Purchasers. Each Purchaser hereby
for itself and for no other Purchaser  represents and warrants to the Company as
follows:

     (a)  Organization;  Authority.  Such Purchaser is an entity duly organized,
validly  existing and in good standing under the laws of the jurisdiction of its
organization with the requisite  corporate or partnership power and authority to
enter into and to consummate the  transactions  contemplated  by the Transaction
Documents and otherwise to carry out its obligations thereunder. The purchase by
such  Purchaser of the  Securities  hereunder  has been duly  authorized  by all
necessary  action on the part of such Purchaser.  Each of this Agreement and the
Registration Rights Agreement has been duly executed by such Purchaser, and when
delivered by such Purchaser in accordance with the terms hereof, will constitute
the valid and legally binding obligation of such Purchaser,  enforceable against
it in accordance with its terms.

     (b)  Investment  Intent.  Such  Purchaser is acquiring  the  Securities  as
principal for its own account for  investment  purposes only and not with a view
to or for distributing or reselling such Securities or any part thereof, without
prejudice, however, to such Purchaser's right, subject to the provisions of this
Agreement, the Registration Rights Agreement and the Debentures, at all times to
sell or otherwise  dispose of all or any part of such Securities  pursuant to an
effective  registration statement under the Securities Act or under an exemption
<PAGE>
from such  registration  and in  compliance  with  applicable  federal and state
securities laws.  Nothing  contained herein shall be deemed a representation  or
warranty by such Purchaser to hold the  Securities for any period of time.  Such
Purchaser is acquiring the  Securities  hereunder in the ordinary  course of its
business. Such Purchaser does not have any agreement or understanding,  directly
or indirectly, with any Person to distribute the Securities.

     (c)  Purchaser   Status.  At  the  time  such  Purchaser  was  offered  the
Securities,  it was,  and at the date hereof it is an  "accredited  investor" as
defined in Rule 501(a)(8) under the Securities Act.

     (d) Experience of such Purchaser. Such Purchaser,  either alone or together
with its representatives,  has such knowledge,  sophistication and experience in
business and financial  matters so as to be capable of evaluating the merits and
risks of the prospective investment in the Securities,  and has so evaluated the
merits and risks of such investment.

     (e) Ability of such Purchaser to Bear Risk of Investment. Such Purchaser is
able to bear the economic risk of an investment  in the  Securities  and, at the
present time, is able to afford a complete loss of such investment.

     (f) Access to Information. Such Purchaser acknowledges that it has reviewed
the Disclosure  Materials and has been afforded (i) the  opportunity to ask such
questions  as  it  has  deemed  necessary  of,  and  to  receive  answers  from,
representatives  of the  Company  concerning  the  terms and  conditions  of the
offering  of the  Securities  and the  merits  and  risks  of  investing  in the
Securities;  (ii) access to  information  about the  Company  and the  Company's
financial condition, results of operations, business, properties, management and
prospects  sufficient  to enable it to evaluate  its  investment;  and (iii) the
opportunity to obtain such additional information which the Company possesses or
can acquire without  unreasonable effort or expense that is necessary to make an
informed  investment  decision with respect to the  investment and to verify the
accuracy  and  completeness  of the  information  contained  in  the  Disclosure
Materials. Neither such inquiries nor any other investigation conducted by or on
behalf of such Purchaser or its  representatives or counsel shall modify,  amend
or affect such Purchaser's right to rely on the truth, accuracy and completeness
of the  Disclosure  Materials and the Company's  representations  and warranties
contained in the Transaction Documents.

     (g) General  Solicitation.  Such Purchaser is not purchasing the Securities
as a result of or  subsequent  to any  advertisement,  article,  notice or other
communication  regarding the Securities published in any newspaper,  magazine or
similar media or broadcast over  television or radio or presented at any seminar
or any other general solicitation or general advertisement.

     (h) Reliance.  Such Purchaser  understands  and  acknowledges  that (i) the
Securities  are being  offered  and sold to it  without  registration  under the
Securities  Act in a  private  placement  that is exempt  from the  registration
provisions of the Securities Act and (ii) the  availability  of such  exemption,
depends in part on, and the Company will rely upon the accuracy and truthfulness
of, the foregoing  representations  and such Purchaser  hereby  consents to such
reliance.
<PAGE>
     The Company acknowledges and agrees that no Purchaser makes or has made any
representations  or  warranties  with respect to the  transactions  contemplated
hereby other than those specifically set forth in this Section 2.2.



                                   ARTICLE III
                         OTHER AGREEMENTS OF THE PARTIES

     3.1  Transfer  Restrictions.  (a) The  Securities  may only be  disposed of
pursuant to an effective  registration  statement  under the  Securities  Act or
pursuant to an available  exemption from or in a transaction  not subject to the
registration  requirements  of the  Securities  Act, and in compliance  with any
applicable federal and state securities laws. In connection with any transfer of
Securities other than pursuant to an effective  registration statement or to the
Company,  except as  otherwise  set forth  herein,  the  Company may require the
transferor  thereof to provide to the Company an opinion of counsel  selected by
the  transferor,  the form and  substance of which  opinion  shall be reasonably
satisfactory  to the Company,  to the effect that such transfer does not require
registration of such  transferred  Securities under the Securities Act. Any such
transferee shall agree in writing to be bound by the terms of this Agreement and
shall have the rights of a Purchaser  under this Agreement and the  Registration
Rights Agreement.

          (b) The Purchasers agree to the imprinting,  so long as is required by
this Section 3.1(b), of the following legend on the Securities:

               NEITHER  THESE  SECURITIES  NOR THE  SECURITIES  INTO WHICH THESE
     SECURITIES ARE  CONVERTIBLE  HAVE BEEN  REGISTERED  WITH THE SECURITIES AND
     EXCHANGE  COMMISSION OR THE SECURITIES  COMMISSION OF ANY STATE IN RELIANCE
     UPON AN EXEMPTION  FROM  REGISTRATION  UNDER THE SECURITIES ACT OF 1933, AS
     AMENDED (THE "SECURITIES  ACT"),  AND,  ACCORDINGLY,  MAY NOT BE OFFERED OR
     SOLD  EXCEPT  PURSUANT TO AN  EFFECTIVE  REGISTRATION  STATEMENT  UNDER THE
     SECURITIES  ACT  OR  PURSUANT  TO  AN  AVAILABLE  EXEMPTION  FROM,  OR IN A
     TRANSACTION NOT SUBJECT TO, THE REGISTRATION REQUIREMENTS OF THE SECURITIES
     ACT AND IN ACCORDANCE WITH APPLICABLE STATE SECURITIES LAWS.

          The Underlying Shares shall not contain the legend set forth above nor
any other legend if the  conversion  of  Debentures  occurs at any time while an
Underlying Shares  Registration  Statement is effective under the Securities Act
or if the holder is relying on Rule 144  promulgated  under the  Securities  Act
("Rule 144") in connection with the resale of such Underlying  Shares, or in the
event there is not an effective  Underlying Shares Registration  Statement,  and
Rule 144 is not then available for resale of the Underlying Shares, at such time
as such legend is not required under  applicable  requirements of the Securities
Act (including judicial  interpretations and pronouncements  issued by the staff
of the  Commission).  The  Company  shall  cause its  counsel to issue the legal
opinion  included in the Transfer Agent  Instructions to the Company's  transfer
agent on the date that an Underlying Shares  Registration  Statement is declared
effective by the  Commission  (such date,  the  "Effective  Date").  The Company
<PAGE>
agrees that  following the  Effective  Date, it will, no later than five Trading
Days  following the delivery by a Purchaser to the Company of a  certificate  or
certificates  representing  Underlying Shares issued with a restrictive  legend,
deliver to such Purchaser certificates representing such Underlying Shares which
shall be free from all restrictive  and other legends.  The Company may not make
any notation on its records or give  instructions  to any transfer  agent of the
Company which enlarge the restrictions of transfer set forth in this Section.

     3.2 Acknowledgment of Dilution.  The Company acknowledges that the issuance
of  Underlying  Shares  upon the  conversion  of the  Debentures  will result in
dilution  of the  outstanding  shares of Common  Stock,  which  dilution  may be
substantial under certain market  conditions.  The Company further  acknowledges
that its obligation to issue Underlying Shares upon conversion of the Debentures
is  unconditional  and  absolute,  subject to the  limitations  set forth in the
Debentures regardless of the effect of any such dilution.

     3.3 Furnishing of  Information.  As long as the Purchasers own  Securities,
the Company  covenants to timely file (or obtain  extensions in respect  thereof
and file within the applicable grace period) all reports required to be filed by
the  Company  after the date hereof  pursuant  to Section  13(a) or 15(d) of the
Exchange Act. As long as the  Purchasers own  Securities,  if the Company is not
required to file reports pursuant to such sections,  it will prepare and furnish
to the  Purchasers  and make publicly  available in accordance  with Rule 144(c)
promulgated  under the  Securities  Act such  information as is required for the
Purchasers  to  sell  the  Securities  under  Rule  144  promulgated  under  the
Securities  Act. The Company  further  covenants  that it will take such further
action as any holder of Securities  may  reasonably  request,  all to the extent
required  from time to time to enable  such  Person  to sell  Underlying  Shares
without  registration  under the  Securities  Act within the  limitation  of the
exemptions  provided by Rule 144 promulgated under the Securities Act, including
causing its attorneys to render and deliver any legal opinion  required in order
to permit a  Purchaser  to receive  Underlying  Shares  free of all  restrictive
legends and to subsequently  sell Underlying  Shares under Rule 144 upon receipt
of a notice of an  intention  to sell or other  form of notice  having a similar
effect.  Upon the request of any such Person,  the Company shall deliver to such
Person a written certification of a duly authorized officer as to whether it has
complied with such requirements.

     3.4  Integration.  The Company shall not, and shall use its best efforts to
ensure that, no Affiliate of the Company shall,  sell, offer for sale or solicit
offers to buy or  otherwise  negotiate in respect of any security (as defined in
Section 2 of the Securities Act) that would be integrated with the offer or sale
of the  Securities  in a manner that would  require the  registration  under the
Securities Act of the sale of the Securities to the Purchasers.


     3.5 Reservation and Listing of Underlying Shares. (a) The Company shall (i)
in the time and manner  required by any national  securities  exchange,  market,
trading or quotation facility on which the Common Stock is then traded,  prepare
and file with such national securities  exchange,  market,  trading or quotation
facility on which the Common Stock is then traded an additional  shares  listing
application  covering a number of shares of Common  Stock which is not less than
the  Initial  Minimum,  (ii) take all steps  necessary  to cause such  shares of
<PAGE>
Common  Stock  to be  approved  for  listing  on any  such  national  securities
exchange,  market or trading or quotation  facility on which the Common Stock is
then listed as soon as possible thereafter,  and (iii) provide to the Purchasers
evidence of such  listing,  and the Company  shall  maintain  the listing of its
Common Stock thereon.

     3.6 Conversion  Procedures.  The Transfer Agent Instructions and Conversion
Notice (as defined in the  Debentures)  set forth the totality of the procedures
with respect to the  conversion of the  Debentures,  including the form of legal
opinion,  if necessary,  that shall be rendered to the Company's  transfer agent
and such other  information and  instructions as may be reasonably  necessary to
enable the Purchasers to convert their Debentures.

     3.7  Conversion  Obligations  of  the  Company.  The  Company  shall  honor
conversions of the Debentures and shall deliver  Underlying Shares in accordance
with  the  respective  terms,  conditions  and  time  periods  set  forth in the
Debentures.

     3.8  Subsequent Financing; Limitation on Registrations.

          (a)  Subject to  Section  3.8(c),  the  Company  shall not,  until the
expiration  of the first to occur of (1) the date on which no principal  amount,
interest or liquidated  damages remain outstanding or owing under the Debentures
and (2) the 360th day after the Closing  Date,  directly or  indirectly,  offer,
sell,  grant any option to purchase,  or  otherwise  dispose of (or announce any
offer,  sale,  grant or any option to purchase or other  disposition) any of its
equity or  equity-equivalent  securities or securities of any of its  Affiliates
that are  exchangeable  or convertible  (directly or  indirectly)  for shares of
Common Stock, including the issuance of any debt or other instrument at any time
over  the  life  thereof  convertible  into or  exchangeable  for  Common  Stock
(collectively, a "Subsequent Placement") at a purchase price per share of Common
Stock  which is equal to or lower than the  closing  sales  price at the time of
such  offering  or  issuance,  unless (A) the  Company  delivers  to each of the
Purchasers a written notice (the "Subsequent Placement Notice") of its intention
to effect such Subsequent  Placement,  which  Subsequent  Placement Notice shall
describe in reasonable  detail the proposed terms of such Subsequent  Placement,
the amount of proceeds  intended to be raised  thereunder,  the Person with whom
such Subsequent  Placement  shall be effected,  and attached to which shall be a
term sheet or similar document relating thereto and (B) such Purchaser shall not
have notified the Company by 6:30 p.m. (New York City time) on the tenth Trading
Day after its receipt of the Subsequent  Placement  Notice of its willingness to
provide (or to cause its sole  designee to provide),  subject to  completion  of
mutually  acceptable  documentation,  financing to the Company on the same terms
set forth in the Subsequent  Placement  Notice.  If the Purchasers shall fail to
notify the Company of their  intention  to enter into such  negotiations  within
such time period, the Company may effect the Subsequent Placement  substantially
upon the terms and to the Persons (or  Affiliates  of such Persons) set forth in
the Subsequent  Placement Notice;  provided,  that the Company shall provide the
Purchasers with a second Subsequent  Placement Notice,  and the Purchasers shall
again have the right of first refusal set forth above in this  paragraph (a), if
the Subsequent  Placement  subject to the initial  Subsequent  Placement  Notice
shall not have been  consummated  for any  reason on the terms set forth in such
Subsequent  Placement  Notice  within thirty (30) Trading Days after the date of
the initial Subsequent Placement Notice with the Person (or an Affiliate of such
<PAGE>
Person)  identified in the Subsequent  Placement Notice. If the Purchasers shall
indicate a willingness to provide financing in excess of the amount set forth in
the  Subsequent  Placement  Notice,  then each  Purchaser  shall be  entitled to
provide financing  pursuant to such Subsequent  Placement Notice up to an amount
equal to such Purchaser's  pro-rata portion of the aggregate principal amount of
Debentures  purchased by such Purchaser  under this  Agreement,  but the Company
shall not be required to accept  financing  from the  Purchasers in an amount in
excess of the amount set forth in the Subsequent Placement Notice.

          (b)  Except  for  (x)  Underlying   Shares,   (y)  other  "Registrable
Securities" (as such term is defined in the Registration Rights Agreement) to be
registered,  and securities of the Company permitted pursuant to Section 6(c) of
the  Registration  Rights Agreement to be registered,  in the Underlying  Shares
Registration Statement in accordance with the Registration Rights Agreement, and
(z) Common Stock permitted to be issued pursuant to Section 3.8 (c), the Company
shall not,  for a period of not less than  ninety  (90)  Trading  Days after the
Effective Date, without the prior written consent of the Purchasers (i) issue or
sell  any  of  its  or any of  its  Affiliates'  equity  or  equity-  equivalent
securities  pursuant to Regulation S promulgated  under the  Securities  Act, or
(ii) register any  securities of the Company.  Any days after the Effective Date
that a Purchaser is unable to sell Underlying Shares under the Underlying Shares
Registration Statement shall be added to such ninety (90) Trading Day period.

          (c) With  respect to Section  3.8(a)  and  3.8(b),  the 360 day and 90
Trading Day periods shall be extended for the number of Trading Days during such
period (A) in which  trading in the Common Stock is suspended by any  securities
exchange or market or quotation system on which the Common Stock is then listed,
or (B) after the  Effectiveness  Date (as  defined  in the  Registration  Rights
Agreement),  during  such  period in which the  Underlying  Shares  Registration
Statement is not effective,  or (C) during which the prospectus  included in the
Underlying Shares Registration  Statement may not be used by the holders thereof
for the resale of Underlying Shares.  The restrictions  contained in Section 3.8
shall not apply to the granting of options or warrants to  employees,  officers,
directors or consultants  of the Company,  and the issuance of Common Stock upon
exercise  of such  options  or  warrants  granted  under any stock  option  plan
heretofore or hereinafter duly adopted by the Company.

     3.9 Transfer of Intellectual Property Rights. Except in connection with the
sale of all or  substantially  all of the  assets of the  Company  or  licensing
arrangements in the ordinary course of the Company's business, the Company shall
not transfer,  sell or otherwise dispose of any Intellectual Property Rights, or
allow any of the Intellectual Property Rights to become subject to any Liens, or
fail to renew  such  Intellectual  Property  Rights (if  renewable  and it would
otherwise  lapse  if not  renewed),without  the  prior  written  consent  of the
Purchasers.

     3.10 Certain Securities Laws Disclosures; Publicity. The Company shall: (i)
at its  discretion,  on the  Closing  Date,  issue  a press  release  reasonably
acceptable to the Purchasers  disclosing the transactions  contemplated  hereby,
(ii) at its discretion, file with the Commission a Report on Form 8-K disclosing
the transactions  contemplated hereby within ten Business Days after the Closing
Date, and (iii) timely file with the  Commission a Form D promulgated  under the
Securities  Act. The Company shall,  no less than two Business Days prior to the
filing of any  disclosure  required by clauses (ii) and (iii)  above,  provide a
copy thereof to the Purchasers for their review.  To the extent  permitted under
applicable law, the Company and the Purchasers  shall consult with each other in
<PAGE>
issuing any other press  releases  or  otherwise  making  public  statements  or
filings and other communications with the Commission or any regulatory agency or
stock market or trading facility with respect to the  transactions  contemplated
hereby and neither  party shall issue any such press  release or otherwise  make
any such public  statement,  filings or other  communications  without the prior
written consent of the other,  except that if such disclosure is required by law
or stock  market  regulations,  in which such case the  disclosing  party  shall
promptly  provide  the other party with prior  notice of such public  statement,
filing or other communication.  Notwithstanding the foregoing, the Company shall
not publicly  disclose the names of the Purchasers,  or include the names of the
Purchasers in any filing with the Commission,  or any regulatory agency, trading
facility or stock market  without the prior written  consent of the  Purchasers,
except  to  the  extent  such  disclosure  (but  not  any  disclosure  as to the
controlling Persons thereof) is required by law or stock market regulations,  in
which case the Company  shall provide the  Purchasers  with prior notice of such
disclosure.

     3.11 Use of Proceeds.  The Company shall use the net proceeds from the sale
of the  Securities  hereunder  for  working  capital  purposes  and  not for the
satisfaction  of any portion of the Company's  debt (other than payment of trade
payables in the ordinary course of the Company's  business and prior practices),
to redeem any Company  equity or  equity-equivalent  securities or to settle any
outstanding litigation.

     3.12  Reimbursement.  If any Purchaser  becomes involved in any capacity in
any  action,  proceeding  or  investigation  brought by or against  any  Person,
including  stockholders  of the  Company,  solely as a result of  acquiring  the
Securities  under this Agreement,  the Company will reimburse such Purchaser for
its  reasonable   legal  and  other  expenses   (including,   the  cost  of  any
investigation,  preparation  and travel in  connection  therewith)  incurred  in
connection  therewith,   as  such  expenses  are  incurred.   The  reimbursement
obligations  of the  Company  under this  paragraph  shall be in addition to any
liability which the Company may otherwise have, shall extend upon the same terms
and  conditions to any  Affiliates of the  Purchasers  who are actually named in
such action,  proceeding  or  investigation,  and partners,  directors,  agents,
employees  and  controlling  persons  (if  any),  as the  case  may  be,  of the
Purchasers  and any such  Affiliate,  and shall be binding upon and inure to the
benefit of any successors,  assigns,  heirs and personal  representatives of the
Company,  the Purchasers and any such Affiliate and any such Person. The Company
also  agrees that  neither the  Purchasers  nor any such  Affiliates,  partners,
directors,  agents, employees or controlling persons shall have any liability to
the  Company  or any  Person  asserting  claims  on behalf of or in right of the
Company solely as a result of acquiring the Securities under this Agreement.

     3.14 Conditions  precedent to the purchase of First Additional  Debentures.
Notwithstanding  anything  to the  contrary  contained  in this  Agreement,  the
commitment of a Purchaser to purchase First Additional  Debentures is subject to
the satisfaction or waiver by such Purchaser of each of the following conditions
as of the First Additional Funding Date:

     (i) Closing of Initial Debentures. The Closing shall have occurred;
<PAGE>
     (ii)  Accuracy  of  the  Company's  Representations  and  Warranties.   The
representations and warranties of the Company contained herein shall be true and
correct as of the date when made and as of the First Additional  Funding Date as
though  made  on  and  as of the  First  Additional  Funding  Date  (other  than
representations and warranties which relate to a specific date, (which shall not
include  representations and warranties relating to the "date hereof"(which need
only be true and correct on the date made));

     (iii)  Performance  by the  Company.  The  Company  shall  have  performed,
satisfied and complied with all covenants, agreements and conditions required by
the  Transaction  Documents to be  performed,  satisfied or complied with by the
Company  between the Closing Date and the First  Additional  Funding Date and no
Event (as defined in the  Registration  Rights  Agreement ) shall have  occurred
which has not been cured to the satisfaction of the Purchasers;

     (iv) No Injunction.  Since the Closing Date, no statute,  rule, regulation,
executive order, decree, ruling or injunction shall have been enacted,  entered,
promulgated,  amended,  modified  or  endorsed  by  any  court  of  governmental
authority of competent jurisdiction or governmental  authority,  stock market or
trading  facility  which  prohibits or makes  impracticable  the purchase of the
First Additional Debentures;

     (v) Adverse  Changes.  Since the Closing Date, no event or series of events
which  reasonably  would be  expected  to have or result in a  Material  Adverse
Effect shall have occurred;

     (vi) No Suspensions  of Trading in Common Stock.  The trading in the Common
Stock shall not have been  suspended by the  Commission  or on the NASDAQ at any
time since the Closing Date and the Company  shall not have  received any notice
of threatened or pending proceedings for delisting the Common Stock from NASDAQ;

     (vii) Shareholder  Approval. No approval of the shareholders of the Company
shall be  required  under the rules of the  Nasdaq  Stock  Market or such  other
exchange or trading  facility or which the Common  Stock is the traded or listed
for trading in order to issue a number of shares of Common  Stock which is equal
to 19.999% of the Company's shares of Common Stock;

     (viii)  Shares of Common  Stock.  The Company  shall have duly reserved the
number of shares of Common Stock as required by the Transaction  Documents to be
reserved for issuance upon conversion of the Debentures;

     (ix) Performance of Conversion  Obligations.  The Company shall have timely
complied with its conversion and delivery requirements under the Debentures.

     3.15 Conditions precedent to the purchase of Second Additional  Debentures.
Notwithstanding  anything  to the  contrary  contained  in this  Agreement,  the
commitment of a Purchaser to purchase Second Additional Debentures is subject to
the satisfaction or waiver by such Purchaser of each of the following conditions
as of the Second Additional Funding Date:
<PAGE>
     (i) Closing of Initial Debentures.  The Closing shall have occurred and the
Company  shall  have  satisfied  each  condition  precedent,  which has not been
waived, to the purchase of First Additional Debentures;

     (ii)  Accuracy  of  the  Company's  Representations  and  Warranties.   The
representations and warranties of the Company contained herein shall be true and
correct as of the date when made and as of the Second Additional Funding Date as
though  made  on  and as of the  Second  Additional  Funding  Date  (other  than
representations  and warranties which relate to a specific date (which shall not
include representations and warranties relating to the "date hereof" (which need
only be true and correct on the date made));

     (iii)  Performance  by the  Company.  The  Company  shall  have  performed,
satisfied and complied with all covenants, agreements and conditions required by
the  Transaction  Documents to be  performed,  satisfied or complied with by the
Company between the Closing Date and the Second  Additional  Funding Date and no
Event (as defined in the  Registration  Rights  Agreement ) shall have  occurred
which has not been cured to the satisfaction of the Purchasers;

     (iv) No Injunction.  Since the Closing Date, no statute,  rule, regulation,
executive order, decree, ruling or injunction shall have been enacted,  entered,
promulgated,  amended,  modified  or  endorsed  by  any  court  of  governmental
authority of competent jurisdiction or governmental  authority,  stock market or
trading  facility  which  prohibits or makes  impracticable  the purchase of the
Second Additional Debentures;

     (v) Adverse  Changes.  Since the Closing Date, no event or series of events
which  reasonably  would be  expected  to have or result in a  Material  Adverse
Effect shall have occurred;

     (vi) No Suspensions  of Trading in Common Stock.  The trading in the Common
Stock shall not have been  suspended by the  Commission  or on the NASDAQ at any
time since the Closing Date and the Company  shall not have  received any notice
of threatened or pending proceedings for delisting the Common Stock from NASDAQ;

     (vii) Shareholder  Approval. No approval of the shareholders of the Company
shall be  required  under the rules of the  Nasdaq  Stock  Market or such  other
exchange or trading  facility on which the Common  Stock is the traded or listed
for trading in order to issue a number of shares of Common  Stock which is equal
to 19.999% of the Company's shares of Common Stock;

     (viii)  Shares of Common  Stock.  The Company  shall have duly reserved the
number of shares of Common Stock as required by the Transaction  Documents to be
reserved for issuance upon conversion of the Debentures;

     (ix) Performance of Conversion  Obligations.  The Company shall have timely
complied with its conversion and delivery requirements under the Debentures.
<PAGE>
                                   ARTICLE IV
                                  MISCELLANEOUS

          4.1 Fees and Expenses. At the Closing, the Company shall reimburse the
Purchasers  for their legal fees and expenses  incurred in  connection  with the
preparation and  negotiation of the Transaction  Documents by paying to Robinson
Silverman  $25,000  for  the  preparation  and  negotiation  of the  Transaction
Documents.  The amount contemplated by the immediately  preceding sentence shall
be retained by the  Purchasers  and shall not be delivered to the Company at the
Closing.  Other than the amount contemplated herein, and except as otherwise set
forth in the Registration  Rights  Agreement,  each party shall pay the fees and
expenses of its advisers,  counsel,  accountants and other experts,  if any, and
all  other  expenses  incurred  by  such  party  incident  to  the  negotiation,
preparation,  execution, delivery and performance of this Agreement. The Company
shall pay all stamp and other  taxes and duties  levied in  connection  with the
issuance of the Securities

          4.2 Entire Agreement;  Amendments. The Transaction Documents, together
with the Exhibits and  Schedules  thereto and the Transfer  Agent  Instructions,
contain  the entire  understanding  of the parties  with  respect to the subject
matter hereof and supersede all prior  agreements  and  understandings,  oral or
written,  with respect to such matters,  which the parties acknowledge have been
merged into such documents, exhibits and schedules.

          4.3 Notices. Any and all notices or other communications or deliveries
required or permitted to be provided  hereunder shall be in writing and shall be
deemed given and effective on the earliest of (i) the date of  transmission,  if
such  notice or  communication  is  delivered  via  facsimile  at the  facsimile
telephone  number  specified in this Section  prior to 6:30 p.m.  (New York City
time) on a Business Day,  (ii) the Business Day after the date of  transmission,
if such notice or  communication  is delivered  via  facsimile at the  facsimile
telephone number specified in this Agreement later than 6:30 p.m. (New York City
time) on any date and earlier than 11:59 p.m. (New York City time) on such date,
(iii) the Business Day  following  the date of mailing,  if sent by.  nationally
recognized  overnight courier service,  or (iv) upon actual receipt by the party
to whom such notice is required  to be given.  The address for such  notices and
communications shall be as follows:
<PAGE>

     If to the Company:      Direct Insite Corporation
                             80 Orville Drive, Bohemia
                             New York, 11716
                             Facsimile No.: (631) 563-8085
                             Attn: Chief Financial Officer

     With a Copy to:         Blau, Kramer, Wactlar & Lieberman, P.C.
                             100 Jericho Quadrangle
                             Jericho, New York 11753
                             Attn: David Lieberman

     If to a  Purchaser:     To the  address set forth under such  Purchaser's
                             name on the signature pages hereto.

or such other  address as may be designated  in writing  hereafter,  in the same
manner, by such Person.

     4.4  Amendments;  Waivers.  No provision of this Agreement may be waived or
amended except in a written instrument  signed, in the case of an amendment,  by
the Company and each of the Purchasers or, in the case of a waiver, by the party
against whom enforcement of any such waiver is sought.  No waiver of any default
with respect to any provision,  condition or requirement of this Agreement shall
be  deemed  to be a  continuing  waiver  in the  future or a waiver of any other
provision,  condition or requirement  hereof, nor shall any delay or omission of
either party to exercise any right  hereunder in any manner  impair the exercise
of any such right accruing to it thereafter.

     4.5  Headings.  The  headings  herein  are  for  convenience  only,  do not
constitute a part of this  Agreement  and shall not be deemed to limit or affect
any of the provisions hereof.

     4.6 Successors and Assigns.  This Agreement shall be binding upon and inure
to the benefit of the parties and their  successors and permitted  assigns.  The
Company may not assign this  Agreement  or any rights or  obligations  hereunder
without  the prior  written  consent of the  Purchasers.  Except as set forth in
Section  3.1(a),  the  Purchasers  may not assign this  Agreement  or any of the
rights or  obligations  hereunder  without  the  consent  of the  Company.  This
provision  shall not limit  any  Purchaser's  right to  transfer  securities  or
transfer or assign rights under the Registration Rights Agreement.

     4.7 No  Third-Party  Beneficiaries.  This  Agreement  is  intended  for the
benefit of the parties  hereto and their  respective  successors  and  permitted
assigns and is not for the benefit of, nor may any provision  hereof be enforced
by, any other Person.

     4.8 Governing  Law. All questions  concerning the  construction,  validity,
enforcement  and  interpretation  of this  Agreement  shall be  governed  by and
construed  and enforced in  accordance  with the  internal  laws of the State of
Delaware,  without  regard to the  principles of conflicts of law thereof.  Each
party hereby irrevocably submits to the exclusive  jurisdiction of the state and
federal  courts sitting in the City of New York,  borough of Manhattan,  for the
adjudication  of any dispute  hereunder  or in  connection  herewith or with any
transaction  contemplated  hereby or discussed herein (including with respect to
the enforcement of the any of the Transaction Documents), and hereby irrevocably
waives,  and agrees not to assert in any suit,  action or proceeding,  any claim
that it is not personally  subject to the  jurisdiction of any such court,  that
such suit,  action or  proceeding  is improper.  Each party  hereby  irrevocably
<PAGE>
waives  personal  service of process and consents to process being served in any
such suit,  action or  proceeding  by mailing a copy thereof via  registered  or
certified  mail or overnight  delivery (with evidence of delivery) to such party
at the address in effect for notices to it under this  Agreement and agrees that
such service shall constitute good and sufficient  service of process and notice
thereof.  Nothing contained herein shall be deemed to limit in any way any right
to serve process in any manner permitted by law.

          4.9  Survival.   The  representations,   warranties,   agreements  and
covenants contained herein shall survive the Closing and the delivery,  exercise
and conversion, (as the case may be) of the Debentures.

          4.10  Execution.  This  Agreement  may be  executed  in  two  or  more
counterparts,  all of which when taken  together shall be considered one and the
same agreement and shall become effective when  counterparts have been signed by
each party and  delivered  to the other  party,  it being  understood  that both
parties need not sign the same  counterpart.  In the event that any signature is
delivered by facsimile  transmission,  such  signature  shall create a valid and
binding  obligation of the party executing (or on whose behalf such signature is
executed) the same with the same force and effect as if such facsimile signature
page were an original thereof.

          4.11  Severability.  In case any one or more of the provisions of this
Agreement  shall be invalid or  unenforceable  in any respect,  the validity and
enforceability of the remaining terms and provisions of this Agreement shall not
in any way be  affecting  or impaired  thereby and the parties  will  attempt to
agree  upon a valid  and  enforceable  provision  which  shall  be a  reasonable
substitute  therefor,  and upon so agreeing,  shall  incorporate such substitute
provision in this Agreement.

          4.12  Remedies.  In addition to being  entitled to exercise all rights
provided herein or granted by law,  including  recovery of damages,  each of the
Purchasers  will be entitled to specific  performance of the  obligations of the
Company under the Transaction Documents.  The parties hereto agree that monetary
damages may not be adequate  compensation for any loss incurred by reason of any
breach of obligations  described in the foregoing  sentence and hereby agrees to
waive in any action for specific  performance of any such obligation the defense
that a remedy at law would be adequate.

          4.13  Independent  Nature of Purchasers'  Obligations and Rights.  The
obligations of each Purchaser under any Transaction  Document is several and not
joint with the  obligations  of any other  Purchaser  and no Purchaser  shall be
responsible  in any way for the  performance  of the  obligations  of any  other
Purchaser under any Transaction  Document.  Nothing  contained  herein or in any
Transaction  Document,  and no action taken by any Purchaser  pursuant  thereto,
shall be deemed to constitute the Purchasers as a partnership, an association, a
joint  venture  or any other kind of entity,  or create a  presumption  that the
Purchasers are in any way acting in concert with respect to such  obligations or
the transactions  contemplated by the Transaction Document. Each Purchaser shall
<PAGE>
be entitled to independently  protect and enforce its rights,  including without
limitation  the  rights  arising  out of  this  Agreement  or  out of the  other
Transaction Documents,  and it shall not be necessary for any other Purchaser to
be joined as an additional party in any proceeding for such purpose.


                   [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK
                            SIGNATURE PAGES FOLLOWS]
<PAGE>


          IN WITNESS  WHEREOF,  the parties hereto have caused this  Convertible
Debenture Purchase Agreement to be duly executed by their respective  authorized
signatories as of the date first indicated above.

                          DIRECT INSITE CORPORATION



                          By:_____________________________________
                             Name:
                             Title:

                   [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK
                      SIGNATURE PAGE FOR PURCHASER FOLLOWS]

<PAGE>



                           GREENWOOD COURT LLC

                           By:_____________________________________
                              Name:
                              Title:


                           Purchase Price:         $3,000,000


                           Address for Notice:

                           Corporate Center
                           Windward One
                           West Bay Road
                           P.O. Box 31106 SMB
                           Grand Cayman, Cayman Islands

                           With copies to:

                           Robinson Silverman Pearce Aronsohn &  Berman LLP
                           1290 Avenue of the Americas
                           New York, NY  10104
                           Facsimile No.:  (212) 541-4630 and (212) 541-1432
                           Attn: Eric L. Cohen, Esq.

<PAGE>
                          REGISTRATION RIGHTS AGREEMENT

          This  Registration  Rights  Agreement  (this  "Agreement") is made and
entered into as of September 27, 2000, among Direct Insite Corporation (formerly
known as Computer Concepts Corp.), a Delaware  corporation (the "Company"),  and
the investors signatory hereto (each such investor is a "Purchaser" and all such
investors are, collectively, the "Purchasers").

          This Agreement is made pursuant to the Convertible  Debenture Purchase
Agreement, dated as of the date hereof among the Company and the Purchasers (the
"Purchase Agreement").

          The Company and the Purchasers hereby agree as follows:

     1.   Definitions

          Capitalized  terms  used and not  otherwise  defined  herein  that are
defined in the Purchase  Agreement  shall have the meanings  given such terms in
the Purchase  Agreement.  As used in this  Agreement,  the following terms shall
have the following meanings:

          "Affiliate"  means, with respect to any Person,  any other Person that
directly or indirectly controls or is controlled by or under common control with
such Person.  For the  purposes of this  definition,  "control,"  when used with
respect to any Person, means the possession, direct or indirect, of the power to
direct or cause the  direction  of the  management  and policies of such Person,
whether  through the ownership of voting  securities,  by contract or otherwise;
and the terms of  "affiliated,"  "controlling"  and  "controlled"  have meanings
correlative to the foregoing.

          "Business Day" means any day except Saturday, Sunday and any day which
shall be a legal holiday or a day on which banking  institutions in the State of
New York are authorized or required by law or other government actions to close.

          "Closing  Date"  shall  have the  meaning  set  forth in the  Purchase
Agreement.

          "Commission" means the Securities and Exchange Commission.

          "Common Stock" means the Company's common stock,  $.0001 par value, or
such securities in to which that such stock shall hereafter be reclassified.

          "Debentures"  means the Convertible  Debentures  issued or issuable to
the Purchasers in accordance with the Purchase Agreement.

          "Effectiveness Date" means with respect to the Registration  Statement
required to be filed hereunder, the 150th day following the Closing Date.

          "Effectiveness  Period"  shall have the  meaning  set forth in Section
2(a).

          "Exchange Act" means the Securities Exchange Act of 1934, as amended.
<PAGE>

          "Filing Date" means, with respect to the Registration  Statement to be
filed following the Closing Date, November 30, 2000.

          "Holder" or "Holders" means the holder or holders, as the case may be,
from time to time of Registrable Securities.

          "Indemnified Party" shall have the meaning set forth in Section 5(c).

          "Indemnifying Party" shall have the meaning set forth in Section 5(c).

          "Losses" shall have the meaning set forth in Section 5(a).

          "Person"  means an individual or a  corporation,  partnership,  trust,
incorporated or  unincorporated  association,  joint venture,  limited liability
company, joint stock company,  government (or an agency or political subdivision
thereof) or other entity of any kind.

          "Proceeding" means an action, claim, suit, investigation or proceeding
(including,  without limitation, an investigation or partial proceeding, such as
a deposition), whether commenced or threatened.

          "Prospectus"  means  the  prospectus   included  in  the  Registration
Statement  (including,  without  limitation,  a  prospectus  that  includes  any
information  previously  omitted from a prospectus filed as part of an effective
registration  statement  in  reliance  upon  Rule  430A  promulgated  under  the
Securities Act), as amended or supplemented by any prospectus  supplement,  with
respect  to  the  terms  of  the  offering  of any  portion  of the  Registrable
Securities covered by the Registration  Statement,  and all other amendments and
supplements to the  Prospectus,  including  post-effective  amendments,  and all
material  incorporated by reference or deemed to be incorporated by reference in
such Prospectus.

          "Registrable Securities" (i) means the shares of Common Stock issuable
upon conversion in full of the Debentures whether now outstanding or hereinafter
issued.

          "Registration  Statement"  means the  registration  statement  and any
additional  registration  statements contemplated by Section 3(c), including (in
each case) the  Prospectus,  amendments  and  supplements  to such  registration
statement or  Prospectus,  including  pre- and  post-effective  amendments,  all
exhibits  thereto,  and all material  incorporated  by reference or deemed to be
incorporated by reference in such registration statement.

          "Rule 144" means Rule 144  promulgated by the  Commission  pursuant to
the  Securities  Act,  as such Rule may be  amended  from  time to time,  or any
similar  rule  or  regulation   hereafter   adopted  by  the  Commission  having
substantially the same effect as such Rule.

          "Rule 415" means Rule 415  promulgated by the  Commission  pursuant to
the  Securities  Act,  as such Rule may be  amended  from  time to time,  or any
similar  rule  or  regulation   hereafter   adopted  by  the  Commission  having
substantially the same effect as such Rule.
<PAGE>

          "Rule 424" means Rule 424  promulgated by the  Commission  pursuant to
the  Securities  Act,  as such Rule may be  amended  from  time to time,  or any
similar  rule  or  regulation   hereafter   adopted  by  the  Commission  having
substantially the same effect as such Rule.

          "Securities Act" means the Securities Act of 1933, as amended, and the
rules and regulations promulgated thereunder.

          "Special Counsel" means one special counsel to the Holders,  for which
the Holders will be reimbursed by the Company pursuant to Section 4.


     2.   Registration

          (a) On or prior to the Filing Date, the Company shall prepare and file
with  the  Commission  a  Registration  Statement  covering  the  resale  of all
Registrable Securities for an offering to be made on a continuous basis pursuant
to Rule 415.  The  Registration  Statement  shall be on Form S-3  (except if the
Company is not then eligible to register for resale the  Registrable  Securities
on Form S-3,  in which case such  registration  shall be on another  appropriate
form and shall contain  (except if otherwise  directed by the Holders) the "Plan
of Distribution" attached hereto as Annex A.
 The Company shall use its best efforts to cause the  Registration  Statement to
be declared effective under the Securities Act as promptly as possible after the
filing thereof,  but in any event prior to the Effectiveness Date, and shall use
its best  efforts to keep such  Registration  Statement  continuously  effective
under the  Securities  Act until the date which is two years after the date that
such  Registration  Statement is declared  effective by the  Commission  or such
earlier  date  when all  Registrable  Securities  covered  by such  Registration
Statement have been sold or may be sold without volume restrictions  pursuant to
Rule 144(k) (the "Effectiveness Period").

          (b) The  Registration  Statement to be filed  hereunder  shall include
4,384,000  shares of Common  Stock for  resale by the  Holders in respect of the
Debentures.

          (c) If (a)  the  Company  files  the  Registration  Statement  without
affording  the  Holder  the  opportunity  to review  and  comment on the same as
required  by Section  3(a)  hereof,  or (b) the  Company  fails to file with the
Commission a request for  acceleration  in accordance  with Rule 461 promulgated
under the  Securities  Act,  within  five days of the date that the  Company  is
notified (orally or in writing, whichever is earlier) by the Commission that the
Registration Statement will not be "reviewed," or not subject to further review,
or (c) the Registration  Statement filed hereunder is not declared  effective by
the  Commission  on or  prior  to  its  Effectiveness  Date,  or (d)  after  the
Registration  Statement is filed with and declared  effective by the Commission,
such  Registration  Statement  ceases  to be  effective  as to  all  Registrable
Securities to which it is required to relate at any time prior to the expiration
of the Effectiveness  Period without being succeeded within ten Business Days by
an amendment  to the  Registration  Statement  or by a  subsequent  Registration
Statement filed with and declared effective by the Commission, or (e) the Common

<PAGE>

Stock shall be delisted or suspended from trading on the Nasdaq  SmallCap Market
("NASDAQ")  or the New York Stock  Exchange,  American  Stock  Exchange,  or the
Nasdaq National Market (each, a "Subsequent Market") for more than three Trading
Days (which need not be consecutive  Trading Days), or (f) the conversion rights
of the Holders  pursuant to the Debentures are suspended for any reason,  or (g)
an amendment to the Registration  Statement is not filed by the Company with the
Commission  within ten Business Days of the  Commission's  notifying the Company
that such  amendment is required in order for the  Registration  Statement to be
declared  effective (any such failure or breach being referred to as an "Event,"
and for  purposes  of  clauses  (a),  (c) and (f) the date on which  such  Event
occurs,  or for purposes of clause (b) the date on which such five day period is
exceeded,  or for  purposes  of  clauses  (d) and (g) the  date  which  such ten
Business Day-period is exceeded, or for purposes of clause (e) the date on which
such three Trading  Day-period is exceeded,  being referred to as "Event Date"),
then,  on (i) the Event Date,  the Company shall pay to each Holder an amount in
cash, as liquidated damages and not as penalty, equal to 3.0% of the outstanding
principal amount of the Debentures at such Event Date, and (ii) if the Event has
not been cured by the first monthly anniversary of the Event Date, on such first
monthly  anniversary of the Event Date and each monthly  anniversary  thereafter
until the  Event at issue is  cured,  the  Company  shall pay to each  Holder an
amount in cash, as liquidated  damages and not as penalty,  equal to 3.0% of the
outstanding principal amount of the Debentures at each such monthly anniversary.
If the Company fails to pay any liquidated  damages  pursuant to this Section in
full within  seven days after the date  payable,  the Company  will pay interest
thereon  at a rate of 18% per  annum  (or such  lesser  maximum  amount  that is
permitted to be paid by applicable  law) to the Holder,  accruing daily from the
date such liquidated damages are due until such amounts,  plus all such interest
thereon,  are paid in full. The liquidated  damages pursuant to the terms hereof
shall apply on a pro-rata  basis for any portion of a month prior to the cure of
an Event.

     3.   Registration Procedures

          In connection with the Company's  registration  obligations hereunder,
the Company shall:

          (a) Not less  than  five  Business  Days  prior to the  filing  of the
Registration  Statement or any related Prospectus or any amendment or supplement
thereto  (including  any  document  that would be  incorporated  or deemed to be
incorporated  therein by  reference),  the  Company  shall,  (i)  furnish to the
Holders and their Special  Counsel copies of all such  documents  proposed to be
filed,   which  documents  (other  than  those  incorporated  or  deemed  to  be
incorporated  by  reference)  will be subject to the review of such  Holders and
their Special  Counsel,  and (ii) cause its officers and directors,  counsel and
independent  certified public  accountants to respond to such inquiries as shall
be  necessary,  in the  reasonable  opinion of  respective  counsel to conduct a
reasonable  investigation  within the meaning of the Securities Act. The Company
shall  not  file  the  Registration  Statement  or any  such  Prospectus  or any
amendments  or  supplements  thereto to which the  Holders of a majority  of the
Registrable  Securities  and their  Special  Counsel  shall  reasonably  object,
provided,  the Company is notified  of such  objection  no later than 3 Business
Days after the Holders have been so furnished copies of such documents.

          (b)  (i)  Prepare  and  file  with  the  Commission  such  amendments,
including  post-effective  amendments,  to the  Registration  Statement  and the
Prospectus  used  in  connection  therewith  as may be  necessary  to  keep  the
Registration  Statement  continuously effective as to the applicable Registrable
Securities for the Effectiveness Period; (ii) cause the related Prospectus to be
amended  or  supplemented  by  any  required  Prospectus  supplement,  and as so

<PAGE>

supplemented  or  amended to be filed  pursuant  to Rule 424;  (iii)  respond as
promptly as reasonably  possible,  and in any event within ten Business Days, to
any comments  received  from the  Commission  with  respect to the  Registration
Statement  or any  amendment  thereto  and as promptly  as  reasonably  possible
provide the Holders true and complete copies of all  correspondence  from and to
the Commission  relating to the Registration  Statement;  and (iv) comply in all
material respects with the provisions of the Securities Act and the Exchange Act
with respect to the  disposition of all  Registrable  Securities  covered by the
Registration  Statement  during the  applicable  period in  accordance  with the
intended  methods  of  disposition  by the  Holders  thereof  set  forth  in the
Registration Statement as so amended or in such Prospectus as so supplemented.

     (c)  Notify  the  Holders of  Registrable  Securities  to be sold and their
Special  Counsel as promptly as reasonably  possible (and, in the case of (i)(A)
below,  not less than five Business Days prior to such filing) and (if requested
by any such  Person)  confirm  such notice in writing no later than one Business
Day following the day (i)(A) when a Prospectus or any  Prospectus  supplement or
post-effective  amendment to the Registration Statement is proposed to be filed;
(B) when the Commission notifies the Company whether there will be a "review" of
such Registration  Statement and whenever the Commission  comments in writing on
such Registration  Statement (the Company shall provide true and complete copies
thereof and all written responses thereto to each of the Holders);  and (C) with
respect to the Registration Statement or any post-effective  amendment, when the
same has become  effective;  (ii) of any request by the  Commission or any other
Federal or state  governmental  authority for  amendments or  supplements to the
Registration Statement or Prospectus or for additional information; (iii) of the
issuance by the Commission of any stop order suspending the effectiveness of the
Registration  Statement covering any or all of the Registrable Securities or the
initiation of any Proceedings  for that purpose;  (iv) if at any time any of the
representations  and  warranties  of the  Company  contained  in  any  agreement
contemplated hereby ceases to be true and correct in all material respects;  (v)
of the receipt by the Company of any notification with respect to the suspension
of the  qualification or exemption from  qualification of any of the Registrable
Securities for sale in any jurisdiction, or the initiation or threatening of any
Proceeding for such purpose;  and (vi) of the occurrence of any event or passage
of time  that  makes  the  financial  statements  included  in the  Registration
Statement  ineligible  for  inclusion  therein  or  any  statement  made  in the
Registration  Statement or Prospectus or any document  incorporated or deemed to
be  incorporated  therein by reference  untrue in any  material  respect or that
requires  any  revisions  to the  Registration  Statement,  Prospectus  or other
documents so that, in the case of the Registration  Statement or the Prospectus,
as the case may be, it will not contain any untrue  statement of a material fact
or omit to state any material fact required to be stated therein or necessary to
make the statements therein, in light of the circumstances under which they were
made, not misleading.

          (d) Promptly deliver to each Holder and their Special Counsel, without
charge, as many copies of the Prospectus or Prospectuses (including each form of
prospectus)  and each  amendment  or  supplement  thereto  as such  Persons  may
reasonably  request.  The Company hereby  consents to the use of such Prospectus
and each  amendment  or  supplement  thereto by each of the  selling  Holders in
connection with the offering and sale of the Registrable  Securities  covered by
such Prospectus and any amendment or supplement thereto.
<PAGE>

     (e) Prior to any public  offering of Registrable  Securities,  use its best
efforts to register or qualify or cooperate  with the selling  Holders and their
Special  Counsel  in  connection  with the  registration  or  qualification  (or
exemption  from  such   registration  or   qualification)  of  such  Registrable
Securities  for offer and sale  under  the  securities  or Blue Sky laws of such
jurisdictions  within the United  States as any Holder  requests in writing,  to
keep each such registration or qualification (or exemption  therefrom) effective
during  the  Effectiveness  Period  and to do any and all  other  acts or things
necessary or advisable to enable the  disposition in such  jurisdictions  of the
Registrable Securities covered by a Registration  Statement;  provided, that the
Company  shall not be  required  to  qualify  generally  to do  business  in any
jurisdiction  where it is not then so  qualified  or subject  the Company to any
material tax in any such jurisdiction where it is not then so subject.

     (f) Cooperate  with the Holders to facilitate  the timely  preparation  and
delivery of certificates  representing Registrable Securities to be delivered to
a transferee pursuant to a Registration  Statement,  which certificates shall be
free,  to  the  extent  permitted  by  the  Purchase  Agreement  and  applicable
securities  laws, of all  restrictive  legends,  and to enable such  Registrable
Securities to be in such  denominations and registered in such names as any such
Holders may request.

     (g) Upon the occurrence of any event  contemplated by Section 3(d)(vi),  as
promptly as reasonably possible, prepare a supplement or amendment,  including a
post-effective  amendment,  to the Registration Statement or a supplement to the
related  Prospectus or any document  incorporated  or deemed to be  incorporated
therein  by  reference,  and file  any  other  required  document  so  that,  as
thereafter  delivered,  neither the  Registration  Statement nor such Prospectus
will contain an untrue  statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the statements  therein,
in light of the circumstances under which they were made, not misleading.

     (h) Comply with all applicable rules and regulations of the Commission.

     4. Registration Expenses. All fees and expenses incident to the performance
of or  compliance  with  this  Agreement  by the  Company  shall be borne by the
Company  whether or not any  Registrable  Securities  are sold  pursuant  to the
Registration  Statement.  The fees and  expenses  referred  to in the  foregoing
sentence shall include, without limitation, (i) all registration and filing fees
(including,  without  limitation,  fees and expenses (A) with respect to filings
required  to be made  with the  NASDAQ  and any  Subsequent  Market on which the
Common Stock is then listed for trading,  and (B) in compliance  with applicable
state  securities  or Blue Sky laws  (including,  without  limitation,  fees and
disbursements   of  counsel  for  the  Company  in  connection   with  Blue  Sky
qualifications or exemptions of the Registrable  Securities and determination of
the eligibility of the Registrable  Securities for investment  under the laws of
such  jurisdictions  as  requested  by the  Holders)),  (ii)  printing  expenses
(including,   without   limitation,   expenses  of  printing   certificates  for
Registrable  Securities and of printing prospectuses  requested by the Holders),
(iii) messenger,  tele phone and delivery expenses,  (iv) fees and disbursements
of counsel for the Company and up to $5,000 of the fees and  expenses of Special
Counsel for the Holders and (v) fees and expenses of all other Persons  retained
by  the  Company  in  connection  with  the  consummation  of  the  transactions
contemplated by this Agreement.
<PAGE>

     5.   Indemnification

     (a) Indemnification by the Company. The Company shall,  notwithstanding any
termination  of this  Agreement,  indemnify and hold  harmless each Holder,  the
officers,  directors,  agents,  brokers  (including  brokers  who offer and sell
Registrable  Securities  as  principal as a result of a pledge or any failure to
perform under a margin call of Common Stock),  investment advisors and employees
of each of them, each Person who controls any such Holder (within the meaning of
Section 15 of the  Securities  Act or Section  20 of the  Exchange  Act) and the
officers,  directors,  agents and employees of each such controlling  Person, to
the fullest  extent  permitted by  applicable  law, from and against any and all
losses,  claims,  damages,  liabilities,  costs (including,  without limitation,
costs of preparation and reasonable attorneys' fees) and expenses (collectively,
"Losses"),  as  incurred,  arising  out of or  relating to any untrue or alleged
untrue statement of a material fact contained in the Registration Statement, any
Prospectus or any form of  prospectus or in any amendment or supplement  thereto
or in any preliminary prospectus,  or arising out of or relating to any omission
or  alleged  omission  of a  material  fact  required  to be stated  therein  or
necessary to make the statements  therein (in the case of any Prospectus or form
of prospectus or supplement  thereto,  in light of the circumstances under which
they were made) not  misleading,  except to the extent,  but only to the extent,
that (1) such untrue  statements or omissions are based solely upon  information
regarding  such  Holder  furnished  in  writing to the  Company  by such  Holder
expressly  for use therein,  or to the extent that such  information  relates to
such Holder or such Holder's  proposed  method of  distribution  of  Registrable
Securities  and was  reviewed and  expressly  approved in writing by such Holder
expressly for use in the Registration Statement, such Prospectus or such form of
Prospectus or in any  amendment or  supplement  thereto or (2) in the case of an
occurrence of an event of the type specified in Section  3(d)(ii)-(vi),  the use
by such  Holder of an  outdated or  defective  Prospectus  after the Company has
notified such Holder in writing that the Prospectus is outdated or defective and
prior to the receipt by such Holder of the Advice  contemplated in Section 6(e).
The Company  shall  notify the Holders  promptly of the  institution,  threat or
assertion of any Proceeding of which the Company is aware in connection with the
transactions contemplated by this Agreement.

     (b)  Indemnification  by Holders.  Each  Holder  shall,  severally  and not
jointly,  indemnify  and hold  harmless the Company,  its  directors,  officers,
agents and employees,  each Person who controls the Company  (within the meaning
of Section 15 of the Securities Act and Section 20 of the Exchange Act), and the
directors,  officers,  agents or employees of such controlling  Persons,  to the
fullest  extent  permitted by  applicable  law,  from and against all Losses (as
determined by a court of competent  jurisdiction in a final judgment not subject
to appeal or  review)  arising  solely  out of or based  solely  upon any untrue
statement  of a material  fact  contained  in any  Registration  Statement,  any
Prospectus,  or any  form  of  prospectus,  or in any  amendment  or  supplement
thereto,  or  arising  solely  out of or based  solely  upon any  omission  of a
material fact required to be stated  therein or necessary to make the statements
therein not misleading to the extent,  but only to the extent,  that such untrue
statement or omission is contained in any information so furnished in writing by
such Holder to the  Company  specifically  for  inclusion  in such  Registration
Statement or such Prospectus or to the extent that (1) such untrue statements or
omissions are based solely upon  information  regarding such Holder furnished in
writing to the  Company by such  Holder  expressly  for use  therein,  or to the
extent that such  information  relates to such Holder or such Holder's  proposed
method of distribution of Registrable  Securities and was reviewed and expressly
approved  in  writing  by such  Holder  expressly  for  use in the  Registration

<PAGE>

Statement,  such  Prospectus  or such form of  Prospectus or in any amendment or
supplement  thereto or (2) in the case of an  occurrence of an event of the type
specified  in Section  3(d)(ii)-(vi),  the use by such  Holder of an outdated or
defective  Prospectus after the Company has notified such Holder in writing that
the  Prospectus is outdated or defective and prior to the receipt by such Holder
of the Advice  contemplated  in Section 6(e). In no event shall the liability of
any selling Holder  hereunder be greater in amount than the dollar amount of the
net proceeds received by such Holder upon the sale of the Registrable Securities
giving rise to such indemnification obligation.

          (c) Conduct of Indemnification Proceedings. If any Proceeding shall be
brought or asserted  against  any Person  entitled to  indemnity  hereunder  (an
"Indemnified  Party"),  such Indemnified  Party shall promptly notify the Person
from whom  indemnity is sought (the  "Indemnifying  Party") in writing,  and the
Indemnifying Party shall assume the defense thereof, including the employment of
counsel reasonably  satisfactory to the Indemnified Party and the payment of all
fees and expenses  incurred in connection with defense thereof;  provided,  that
the failure of any  Indemnified  Party to give such notice shall not relieve the
Indemnifying Party of its obligations or liabilities pursuant to this Agreement,
except (and only) to the extent that it shall be finally  determined  by a court
of  competent  jurisdiction  (which  determination  is not  subject to appeal or
further  review)  that  such  failure  shall  have  proximately  and  materially
adversely prejudiced the Indemnifying Party.

          An Indemnified  Party shall have the right to employ separate  counsel
in any such Proceeding and to participate in the defense  thereof,  but the fees
and expenses of such counsel shall be at the expense of such  Indemnified  Party
or Parties unless:  (1) the Indemnifying Party has agreed in writing to pay such
fees and expenses;  or (2) the Indemnifying  Party shall have failed promptly to
assume  the  defense  of  such  Proceeding  and  to  employ  counsel  reasonably
satisfactory to such Indemnified Party in any such Proceeding;  or (3) the named
parties to any such Proceeding  (including any impleaded  parties)  include both
such Indemnified  Party and the Indemnifying  Party, and such Indemnified  Party
shall have been  advised by counsel  that a conflict  of  interest  is likely to
exist if the same  counsel  were to  represent  such  Indemnified  Party and the
Indemnifying  Party (in which  case,  if such  Indemnified  Party  notifies  the
Indemnifying  Party in writing that it elects to employ separate  counsel at the
expense of the Indemnifying  Party,  the  Indemnifying  Party shall not have the
right to assume the defense thereof and the reasonable fees and expenses of such
counsel shall be at the expense of the  Indemnifying  Party).  The  Indemnifying
Party shall not be liable for any  settlement  of any such  Proceeding  effected
without its written consent,  which consent shall not be unreasonably  withheld.
No  Indemnifying  Party  shall,   without  the  prior  written  consent  of  the
Indemnified Party, effect any settlement of any pending Proceeding in respect of
which any  Indemnified  Party is a party,  unless  such  settlement  includes an
unconditional  release of such  Indemnified  Party from all  liability on claims
that are the subject matter of such Proceeding.

          All reasonable fees and expenses of the Indemnified  Party  (including
reasonable  fees  and  expenses  to  the  extent  incurred  in  connection  with
investigating   or  preparing  to  defend  such   Proceeding  in  a  manner  not
inconsistent  with this  Section)  shall be paid to the  Indemnified  Party,  as
incurred, within ten Business Days of written notice thereof to the Indemnifying
Party  (regardless  of whether it is ultimately  determined  that an Indemnified
Party  is  not  entitled  to  indemnification  hereunder;   provided,  that  the
Indemnifying  Party may require such Indemnified Party to undertake to reimburse
all such fees and  expenses  to the extent it is finally  judicially  determined
that such Indemnified Party is not entitled to indemnification hereunder).
<PAGE>

     (d) Contribution. If a claim for indemnification under Section 5(a) or 5(b)
is  unavailable  to  an  Indemnified  Party  (by  reason  of  public  policy  or
otherwise),   then  each  Indemnifying  Party,  in  lieu  of  indemnifying  such
Indemnified  Party,  shall  contribute  to the  amount  paid or  payable by such
Indemnified  Party  as a  result  of  such  Losses,  in  such  proportion  as is
appropriate  to  reflect  the  relative  fault  of the  Indemnifying  Party  and
Indemnified  Party in connection with the actions,  statements or omissions that
resulted in such Losses as well as any other relevant equitable  considerations.
The relative fault of such  Indemnifying  Party and  Indemnified  Party shall be
determined by reference to, among other things,  whether any action in question,
including any untrue or alleged untrue  statement of a material fact or omission
or alleged omission of a material fact, has been taken or made by, or relates to
information  supplied by, such Indemnifying  Party or Indemnified Party, and the
parties'  relative intent,  knowledge,  access to information and opportunity to
correct or prevent  such  action,  statement  or  omission.  The amount  paid or
payable by a party as a result of any Losses shall be deemed to include, subject
to the limitations set forth in Section 5(c), any reasonable attorneys' or other
reasonable  fees or  expenses  incurred  by such  party in  connection  with any
Proceeding to the extent such party would have been indemnified for such fees or
expenses if the  indemnification  provided for in this Section was  available to
such party in accordance with its terms.

     The  parties  hereto  agree  that it  would  not be just and  equitable  if
contribution  pursuant  to  this  Section  5(d)  were  determined  by  pro  rata
allocation or by any other method of allocation  that does not take into account
the equitable considerations referred to in the immediately preceding paragraph.
Notwithstanding the provisions of this Section 5(d), no Holder shall be required
to contribute, in the aggregate, any amount in excess of the amount by which the
proceeds  actually  received  by such  Holder  from the sale of the  Registrable
Securities subject to the Proceeding exceeds the amount of any damages that such
Holder has  otherwise  been  required to pay by reason of such untrue or alleged
untrue statement or omission or alleged omission.

     The indemnity and contribution  agreements contained in this Section are in
addition  to any  liability  that  the  Indemnifying  Parties  may  have  to the
Indemnified Parties.


     6. Miscellaneous

     (a) Amendments and Waivers. The provisions of this Agreement, including the
provisions of this sentence, may not be amended,  modified or supplemented,  and
waivers or consents to departures  from the provisions  hereof may not be given,
unless the same shall be in writing and signed by the Company and the Holders of
at  least   two-thirds   of  the  then   outstanding   Registrable   Securities.
Notwithstanding the foregoing, a waiver or consent to depart from the provisions
hereof  with  respect  to a matter  that  relates  exclusively  to the rights of
Holders  and that does not  directly  or  indirectly  affect the rights of other
Holders  may be  given by  Holders  of at least a  majority  of the  Registrable
Securities to which such waiver or consent relates; provided,  however, that the
provisions of this sentence may not be amended, modified, or supplemented except
in accordance with the provisions of the immediately preceding sentence.
<PAGE>

          (b) No  Inconsistent  Agreements.  Neither  the Company nor any of its
subsidiaries has entered, as of the date hereof, nor shall the Company or any of
its  subsidiaries,  on or  after  the  date of this  Agreement,  enter  into any
agreement with respect to its securities that would have the effect of impairing
the rights granted to the Holders in this Agreement or otherwise  conflicts with
the provisions  hereof.  Except as and to the extent  specified in Schedule 6(b)
hereto,  neither the Company nor any of its subsidiaries has previously  entered
into any agreement  granting any registration  rights with respect to any of its
securities to any Person that have not been satisfied in full.

          (c) No  Piggyback  on  Registrations.  Except  as  and  to the  extent
specified in Schedule  6(b) hereto,  neither the Company nor any of its security
holders  (other than the Holders in such capacity  pursuant  hereto) may include
securities  of  the  Company  in  the  Registration  Statement  other  than  the
Registrable  Securities,  and the Company  shall not after the date hereof enter
into any agreement providing any such right to any of its security holders.

          (d) Compliance.  Each Holder  covenants and agrees that it will comply
with the prospectus delivery requirements of the Securities Act as applicable to
it  in  connection  with  sales  of  Registrable   Securities  pursuant  to  the
Registration Statement.

          (e) Discontinued Disposition. Each Holder agrees by its acquisition of
such  Registrable  Securities that, upon receipt of a notice from the Company of
the  occurrence  of any  event  of the  kind  described  in  Sections  3(d)(ii),
3(d)(iii), 3(d)(iv), 3(d)(v) or 3(d)(vi), such Holder will forthwith discontinue
disposition of such  Registrable  Securities  under the  Registration  Statement
until such Holder's receipt of the copies of the supplemented  Prospectus and/or
amended  Registration  Statement  contemplated  by Section  3(h), or until it is
advised in writing (the  "Advice") by the Company that the use of the applicable
Prospectus  may be resumed,  and, in either  case,  has  received  copies of any
additional  or  supplemental  filings  that are  incorporated  or  deemed  to be
incorporated  by reference in such  Prospectus or  Registration  Statement.  The
Company may provide  appropriate  stop orders to enforce the  provisions of this
paragraph.

          (f) Piggy-Back Registrations.  If at any time during the Effectiveness
Period  there is not an  effective  Registration  Statement  covering all of the
Registrable  Securities and the Company shall determine to prepare and file with
the  Commission  a  registration  statement  relating to an offering for its own
account or the account of others under the  Securities  Act of any of its equity
securities,  other than on Form S-4 or Form S-8 (each as  promulgated  under the
Securities Act) or their then  equivalents  relating to equity  securities to be
issued solely in connection  with any  acquisition  of any entity or business or
equity  securities  issuable in connection  with stock option or other  employee
benefit plans, then the Company shall send to each Holder written notice of such
determination and, if within fifteen days after receipt of such notice, any such
Holder  shall  so  request  in  writing,  the  Company  shall  include  in  such
registration  statement  all or any  part of such  Registrable  Securities  such
holder requests to be registered.
<PAGE>
          (g) Notices. Any and all notices or other communications or deliveries
required or permitted to be provided  hereunder shall be in writing and shall be
deemed given and effective on the earliest of (i) the date of  transmission,  if
such  notice or  communication  is  delivered  via  facsimile  at the  facsimile
telephone  number  specified in this Section  prior to 6:30 p.m.  (New York City
time) on a Business Day,  (ii) the Business Day after the date of  transmission,
if such notice or  communication  is delivered  via  facsimile at the  facsimile
telephone number specified in this Agreement later than 6:30 p.m. (New York City
time) on any date and earlier than 11:59 p.m. (New York City time) on such date,
(iii) the  Business Day  following  the date of mailing,  if sent by  nationally
recognized  overnight courier service,  or (iv) upon actual receipt by the party
to whom such notice is required  to be given.  The address for such  notices and
communications shall be as follows:

     If to the Company:    Direct Insite Corporation
                           80 Orville Drive
                           Bohemia, NY 11716
                           Facsimile No.: (631) 563-8085
                           Attn: Chief Financial Officer

     With a Copy to:       Blau, Kramer, Wactlar & Lieberman, P.C.
                           100 Jericho Quadrangle
                           Jericho, New York 11753
                           Attn: David Lieberman

     If to a  Purchaser:   To the  address set forth
                           under such  Purchaser's name on the signature pages
                           hereto.

     If to any other Person who is then the registered Holder:

                           To  the  address of  such Holder as it appears in the
                           stock transfer books of the Company

or such other  address as may be designated  in writing  hereafter,  in the same
manner, by such Person.

          (h) Successors and Assigns.  This Agreement shall inure to the benefit
of and be  binding  upon the  successors  and  permitted  assigns of each of the
parties  and shall  inure to the  benefit of each  Holder.  The  Company may not
assign its rights or obligations  hereunder without the prior written consent of
each Holder.  Each Holder may assign their  respective  rights  hereunder in the
manner and to the Persons as permitted under the Purchase Agreement.

          (i)  Counterparts.  This  Agreement  may be  executed in any number of
counterparts,  each of which when so executed  shall be deemed to be an original
and, all of which taken together shall constitute one and the same Agreement. In
the event that any  signature  is  delivered  by  facsimile  transmission,  such
signature shall create a valid binding  obligation of the party executing (or on
whose behalf such signature is executed) the same with the same force and effect
as if such facsimile signature were the original thereof.
<PAGE>

     (j) Governing  Law. All questions  concerning the  construction,  validity,
enforcement  and  interpretation  of this  Agreement  shall be  governed  by and
construed and enforced in accordance  with the internal laws of the State of New
York,  without regard to the principles of conflicts of law thereof.  Each party
hereby  irrevocably  submits  to the  exclusive  jurisdiction  of the  state and
federal  courts sitting in the City of New York,  borough of Manhattan,  for the
adjudication  of any dispute  hereunder  or in  connection  herewith or with any
transaction  contemplated  hereby or discussed  herein,  and hereby  irrevocably
waives,  and agrees not to assert in any suit,  action or proceeding,  any claim
that it is not personally  subject to the  jurisdiction of any such court,  that
such suit,  action or  proceeding  is improper.  Each party  hereby  irrevocably
waives  personal  service of process and consents to process being served in any
such suit,  action or  proceeding by mailing a copy thereof to such party at the
address in effect for  notices to it under this  Agreement  and agrees that such
service  shall  constitute  good and  sufficient  service of process  and notice
thereof.  Nothing contained herein shall be deemed to limit in any way any right
to serve process in any manner permitted by law.

     (k) Cumulative  Remedies.  The remedies  provided herein are cumulative and
not exclusive of any remedies provided by law.

     (l) Severability.  If any term, provision,  covenant or restriction of this
Agreement is held by a court of competent  jurisdiction to be invalid,  illegal,
void or  unenforceable,  the remainder of the terms,  provisions,  covenants and
restrictions set forth herein shall remain in full force and effect and shall in
no way be affected,  impaired or  invalidated,  and the parties hereto shall use
their reasonable  efforts to find and employ an alternative means to achieve the
same or  substantially  the  same  result  as that  contemplated  by such  term,
provision,  covenant or restriction.  It is hereby stipulated and declared to be
the intention of the parties that they would have executed the remaining  terms,
provisions, covenants and restrictions without including any of such that may be
hereafter declared invalid, illegal, void or unenforceable.

     (m)  Headings.  The  headings  in this  Agreement  are for  convenience  of
reference only and shall not limit or otherwise affect the meaning hereof.

     (n)  Independent   Nature  of  Purchasers'   Obligations  and  Rights.  The
obligations  of each  Purchaser  hereunder  is  several  and not joint  with the
obligations  of any  other  Purchaser  hereunder,  and  no  Purchaser  shall  be
responsible  in any way for the  performance  of the  obligations  of any  other
Purchaser  hereunder.  Nothing  contained  herein or in any other  agreement  or
document delivered at any closing, and no action taken by any Purchaser pursuant
hereto  or  thereto,   shall  be  deemed  to  constitute  the  Purchasers  as  a
partnership,  an  association,  a joint venture or any other kind of entity,  or
create a presumption  that the  Purchasers are in any way acting in concert with
respect to such obligations or the transactions  contemplated by this Agreement.
Each  Purchaser  shall be entitled to protect and enforce its rights,  including
without limitation the rights arising out of this Agreement, and it shall not be
necessary  for any other  Purchaser to be joined as an  additional  party in any
proceeding for such purpose.


                   [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK
                           SIGNATURE PAGES TO FOLLOW]

<PAGE>


          IN WITNESS WHEREOF, the parties have executed this Registration Rights
Agreement as of the date first written above.

                         DIRECT INSITE CORPORATION



                         By:_____________________________________
                            Name:
                            Title:






                   [REMAINDER OF PAGE INTENTIONALLY LEFT BLANK
                     SIGNATURE PAGES OF PURCHASER TO FOLLOW]

<PAGE>


                     GREENWOOD COURT LLC

                     By:_____________________________________
                         Name:
                         Title:


                    Address for Notice:

                    Corporate Center
                    Windward One
                    West Bay Road
                    P.O. Box 31106 SMB
                    Grand Cayman, Cayman Islands

                    With copies to:

                    Robinson Silverman Pearce Aronsohn & Berman LLP
                    1290 Avenue of the Americas
                    New York, NY  10104
                    Facsimile No.:  (212) 541-4630 and (212) 541-1432
                    Attn: Eric L. Cohen, Esq.

<PAGE>



                                                                        Annex
                                                              A


                              Plan of Distribution

  The  Selling   Stockholders   and  any  of  their   pledgees,   assignees  and
successors-in-interest  may, from time to time,  sell any or all of their shares
of Common Stock on any stock exchange,  market or trading  facility on which the
shares  are traded or in private  transactions.  These  sales may be at fixed or
negotiated  prices.  The  Selling  Stockholders  may  use any one or more of the
following methods when selling shares:

--   ordinary brokerage transactions and transactions in which the broker-dealer
     solicits purchasers;

--   block trades in which the broker-dealer  will attempt to sell the shares as
     agent but may  position  and resell a portion of the block as  principal to
     facilitate the transaction;

--   purchases by a broker-dealer  as principal and resale by the  broker-dealer
     for its account;

--   an exchange  distribution  in accordance  with the rules of the  applicable
     exchange;

--   privately negotiated transactions;

--   broker-dealers may agree with the Selling  Stockholders to sell a specified
     number of such shares at a stipulated price per share;

--   a combination of any such methods of sale; and

--   any other method permitted pursuant to applicable law.

     The  Selling  Stockholders  may also sell  shares  under Rule 144 under the
Securities Act, if available, rather than under this prospectus.

     The Selling Stockholders may pledge their shares to their brokers under the
margin provisions of customer agreements. If a Selling Stockholder defaults on a
margin  loan,  the broker  may,  from time to time,  offer and sell the  pledged
shares.  The Selling  Stockholders  have  advised the Company that they have not
entered  into  any  agreements,   understandings   or   arrangements   with  any
underwriters  or  broker-dealers  regarding  the sale of their shares other than
ordinary  course  brokerage  arrangements,   nor  is  there  an  underwriter  or
coordinating broker acting in connection with the proposed sale of shares by the
Selling Stockholders.

     Broker-dealers  engaged by the Selling  Stockholders  may arrange for other
brokers-dealers to participate in sales.  Broker-dealers may receive commissions
or discounts from the Selling  Stockholders  (or, if any  broker-dealer  acts as
agent  for the  purchaser  of  shares,  from the  purchaser)  in  amounts  to be
negotiated.  The  Selling  Stockholders  do not  expect  these  commissions  and
discounts to exceed what is customary in the types of transactions involved.
<PAGE>

     The Selling Stockholders and any broker-dealers or agents that are involved
in selling the shares may be deemed to be  "underwriters"  within the meaning of
the Securities Act in connection with such sales. In such event, any commissions
received  by such  broker-dealers  or agents and any profit on the resale of the
shares  purchased  by them  may be  deemed  to be  underwriting  commissions  or
discounts under the Securities Act.

     The  Company  is  required  to pay all fees and  expenses  incident  to the
registration of the shares,  including fees and  disbursements of counsel to the
Selling   Stockholders.   The  Company  has  agreed  to  indemnify  the  Selling
Stockholders against certain losses, claims, damages and liabilities,  including
liabilities under the Securities Act.

<PAGE>
NEITHER  THIS  DEBENTURE  NOR  THE  SECURITIES  INTO  WHICH  THIS  DEBENTURE  IS
CONVERTIBLE HAVE BEEN REGISTERED WITH THE SECURITIES AND EXCHANGE  COMMISSION OR
THE  SECURITIES  COMMISSION  OF ANY STATE IN  RELIANCE  UPON AN  EXEMPTION  FROM
REGISTRATION  UNDER THE  SECURITIES  ACT OF 1933,  AS AMENDED  (THE  "SECURITIES
ACT"),  AND,  ACCORDINGLY,  MAY NOT BE OFFERED  OR SOLD  EXCEPT  PURSUANT  TO AN
EFFECTIVE  REGISTRATION  STATEMENT  UNDER THE  SECURITIES  ACT OR PURSUANT TO AN
AVAILABLE  EXEMPTION FROM, OR IN A TRANSACTION NOT SUBJECT TO, THE  REGISTRATION
REQUIREMENTS  OF THE  SECURITIES  ACT AND IN ACCORDANCE  WITH  APPLICABLE  STATE
SECURITIES LAWS.


No. 1                                                                 $2,000,000

                            DIRECT INSITE CORPORATION
                            6% CONVERTIBLE DEBENTURE
                             DUE SEPTEMBER 27, 2002

     THIS DEBENTURE is one of a series of duly authorized and issued  debentures
of Direct Insite  Corporation  (formerly known as Computer  Concepts  Corp.),  a
Delaware corporation,  having a principal place of business at 80 Orville Drive,
Bohemia,  New York  11716  (the  "Company"),  designated  as its 6%  Convertible
Debentures,  due September 27, 2002, in the aggregate  principal amount of Three
Million Dollars ($3,000,000) (the "Debentures").

     FOR VALUE RECEIVED,  the Company  promises to pay to Greenwood Court LLC or
its registered assigns (the "Holder"),  the principal sum of Two Million Dollars
($2,000,000),  on September 27, 2002 or such earlier date as the  Debentures are
required or permitted to be repaid as provided  hereunder (the "Maturity  Date")
and to pay  interest  to  the  Holder  on the  aggregate  unconverted  and  then
outstanding  principal  amount of this  Debenture  at the rate of 6% per  annum,
payable on each  Conversion Date (as defined herein) and on the Maturity Date in
cash or shares of Common  Stock (as defined in Section 6).  Subject to the terms
and conditions  herein, the decision whether to pay interest hereunder in shares
of Common Stock or cash shall be at the discretion of the Company. Not less than
ten Trading Days (as defined in Section 6) prior to each  Conversion  Date,  the
Company  shall  provide the Holder with  written  notice of its  election to pay
interest hereunder in cash or in shares of Common Stock pursuant to the terms of
Section  4(a)(i)  (the  Company may  indicate  in such notice that the  election
contained  in such notice  shall  continue  for later  periods  until  revised).
Failure to timely provide such written notice shall be deemed an election by the
Company to pay the  interest on such  Conversion  Date in shares of Common Stock
pursuant to the terms of Section 4(a)(i).  If interest is paid by the Company in
shares of its Common Stock,  then the number of shares of Common Stock  issuable
on account of such interest shall equal the cash amount of such interest on such
Conversion Date divided by the Conversion Price (as defined below) on such date.
Interest  shall be  calculated  on the basis on a 360-day  year and shall accrue
daily  commencing  on the  Original  Issue Date (as  defined in Section 6) until

<PAGE>

payment in full of the  principal  sum,  together  with all  accrued  and unpaid
interest  and other  amounts  which may  become  due  hereunder,  has been made.
Interest hereunder will be paid to the Person (as defined in Section 6) in whose
name this  Debenture  is  registered  on the  records of the  Company  regarding
registration and transfers of Debentures (the "Debenture Register"). All overdue
accrued and unpaid interest to be paid in cash hereunder shall entail a late fee
at the rate of 18% per annum (or such lower maximum amount of interest permitted
to be charged under applicable law) ("Late Fee") (to accrue daily, from the date
such  interest is due  hereunder  through and  including  the date of  payment),
payable in cash. If such Late Fee is paid by the Company in shares of its Common
Stock,  then the number of shares of Common  Stock  issuable  on account of such
Late Fee shall  equal the cash  amount of such Late Fee on such Late Fee payment
date divided by the Conversion Price on such date.

     This Debenture is subject to the following additional provisions:

     Section 1. This Debenture is exchangeable for an equal aggregate  principal
amount of Debentures of different authorized denominations,  as requested by the
Holder  surrendering  the  same.  No  service  charge  will  be  made  for  such
registration of transfer or exchange.

     Section 2. This  Debenture  has been issued  subject to certain  investment
representations  of the original Holder set forth in the Purchase  Agreement (as
defined in Section 6) and may be  transferred  or exchanged  only in  compliance
with  the  Purchase  Agreement.  Prior to due  presentment  to the  Company  for
transfer of this  Debenture,  the Company and any agent of the Company may treat
the Person (as  defined  in  Section  6) in whose  name this  Debenture  is duly
registered  on the  Debenture  Register  as the owner  hereof for the purpose of
receiving payment as herein provided and for all other purposes,  whether or not
this  Debenture is overdue,  and neither the Company nor any such agent shall be
affected by notice to the contrary.

     Section 3.     Events of Default.

          (a) "Event of Default",  wherever  used  herein,  means any one of the
following  events  (whatever  the reason and  whether it shall be  voluntary  or
involuntary or effected by operation of law or pursuant to any judgment,  decree
or order of any court, or any order, rule or regulation of any administrative or
governmental body):

                    (i) any default in the payment of the principal of, interest
     on or liquidated  damages in respect of, any Debentures,  free of any claim
     of  subordination,  as and when  the  same  shall  become  due and  payable
     (whether on a Conversion  Date or the Maturity Date or by  acceleration  or
     otherwise);

                    (ii) the Company  shall fail to observe or perform any other
     covenant,  agreement  or warranty  contained  in, or  otherwise  commit any
     breach of any of the  Transaction  Documents (as defined in Section 6), and
     such failure or breach shall not have been remedied  within five days after
     the date on which written  notice of such failure or breach shall have been
     given to the Company;
<PAGE>

                    (iii) the Company or any of its subsidiaries shall commence,
     or there shall be  commenced  against the Company or any such  subsidiary a
     case under any applicable bankruptcy or insolvency laws as now or hereafter
     in effect or any  successor  thereto,  or the Company  commences  any other
     proceeding  under  any  reorganization,  arrangement,  adjustment  of debt,
     relief of debtors, dissolution, insolvency or liquidation or similar law of
     any jurisdiction whether now or hereafter in effect relating to the Company
     or any subsidiary  thereof or there is commenced against the Company or any
     subsidiary  thereof any such  bankruptcy,  insolvency  or other  proceeding
     which  remains  undismissed  for a period of 60 days; or the Company or any
     subsidiary  thereof is adjudicated  insolvent or bankrupt;  or any order of
     relief or other order approving any such case or proceeding is entered;  or
     the  Company or any  subsidiary  thereof  suffers  any  appointment  of any
     custodian or the like for it or any substantial  part of its property which
     continues  undischarged or unstayed for a period of 60 days; or the Company
     or any  subsidiary  thereof makes a general  assignment  for the benefit of
     creditors;  or the  Company  shall fail to pay,  or shall  state that it is
     unable  to pay,  or shall be unable to pay,  its  debts  generally  as they
     become due; or the Company or any  subsidiary  thereof shall call a meeting
     of its  creditors  with a view to arranging a  composition,  adjustment  or
     restructuring of its debts; or the Company or any subsidiary  thereof shall
     by any act or failure to act expressly indicate its consent to, approval of
     or acquiescence  in any of the foregoing;  or any corporate or other action
     is taken by the  Company  or any  subsidiary  thereof  for the  purpose  of
     effecting any of the foregoing;

                    (iv) the  Company  shall  default in any of its  obligations
     under  any other  Debenture  or any  mortgage,  credit  agreement  or other
     facility,  indenture  agreement,  factoring  agreement or other  instrument
     under  which  there may be  issued,  or by which  there may be  secured  or
     evidenced any  indebtedness  for borrowed money or money due under any long
     term leasing or factoring arrangement of the Company in an amount exceeding
     $100,000,  whether  such  indebtedness  now  exists or shall  hereafter  be
     created and such  default  shall  result in such  indebtedness  becoming or
     being  declared  due and  payable  prior  to the  date on  which  it  would
     otherwise become due and payable;

                    (v) the Common  Stock shall fail to be quoted for trading on
     the Nasdaq SmallCap Market ("NASDAQ') or listed for trading on the New York
     Stock  Exchange,  American  Stock  Exchange or the Nasdaq  National  Market
     (each,  a  "Subsequent  Market")  for an aggregate of ten (10) Trading Days
     (which need not be consecutive Trading Days);

                    (vi) the  Company  shall be a party to any Change of Control
     Transaction  (as defined in Section 6),  shall agree to sell or dispose all
     or in excess of 33% of its assets in one or more  transactions  (whether or
     not such sale would constitute a Change of Control  Transaction),  or shall
     redeem  or  repurchase  more than a de  minimis  number of shares of Common
     Stock or other equity  securities of the Company (other than redemptions of
     Underlying Shares (as defined in Section 6));
<PAGE>

                    (vii)  an  Underlying  Shares  Registration   Statement  (as
     defined  in  Section  6) shall  not have  been  declared  effective  by the
     Commission (as defined in Section 6) on or prior to the 210th day after the
     Original Issue Date;

                    (viii) if,  during the  Effectiveness  Period (as defined in
     the  Registration   Rights  Agreement  (as  defined  in  Section  6)),  the
     effectiveness of the Underlying  Shares  Registration  Statement lapses for
     any  reason or the  Holder  shall not be  permitted  to resell  Registrable
     Securities  (as defined in the  Registration  Rights  Agreement)  under the
     Underlying  Shares  Registration  Statement,  in either case, for more than
     five consecutive  Trading Days or an aggregate of eight Trading Days (which
     need not be consecutive Trading Days);

                    (ix)  an  Event  (as  defined  in  the  Registration  Rights
     Agreement)  shall not have been  cured to the  satisfaction  of the  Holder
     prior to the  expiration  of thirty days from the Event Date (as defined in
     the Registration  Rights  Agreement)  relating thereto (other than an Event
     resulting from a failure of an Underlying Shares Registration  Statement to
     be declared  effective by the Commission on or prior to the 210th day after
     the Original Issue Date, which shall be covered by Section 3(a)(vii));

                    (x) the  Company  shall  fail  for  any  reason  to  deliver
     certificates  to a Holder prior to the fifth Trading Day after a Conversion
     Date pursuant to and in  accordance  with Section 4(b) or the Company shall
     provide notice to the Holder,  including by way of public announcement,  at
     any time, of its intention not to comply with requests for  conversions  of
     any Debentures in accordance with the terms hereof;

                    (xi) the  Company  shall fail for any reason to deliver  the
     payment in cash pursuant to a Buy-In (as defined  herein)  within five days
     after written notice is deemed delivered hereunder to the Company.

          (b) If any  Event  of  Default  occurs  and is  continuing,  the  full
principal  amount of this  Debenture  (and,  at the Holder's  option,  all other
Debentures  then held by such Holder),  together with interest and other amounts
owing in  respect  thereof,  to the date of  acceleration  shall  become  at the
Holder's election,  immediately due and payable in cash, provided however,  that
if the  Company  fails to pay the amounts due as a result of an Event of Default
by the seventh  Trading Day following the  declaration of an Event of Default in
cash,  the Holder may request  payment of such amounts in stock,  determined  by
reference to the Conversion Price then in effect. The number of shares of Common
Stock issuable in payment  thereof shall be determined by dividing the aggregate
amount due to the Holder by the Conversion  Price.  The aggregate amount payable
upon an  Event  of  Default  shall  be  equal  to the  sum of (i) the  Mandatory
Prepayment  Amount (as  defined  in Section 6) plus (ii) the  product of (A) the
number of Underlying  Shares issued in respect of conversions  hereunder  within
thirty days of the date of a declaration of an Event of Default and then held by
the  Holder  and (B) the  Closing  Price (as  defined  in Section 6) on the date

<PAGE>

prepayment is due or the date the full  prepayment  price is paid,  whichever is
greater.  Interest  shall accrue on the  prepayment  amount  hereunder  from the
seventh  day after such  amount is due  (being the date of an Event of  Default)
through the date of  prepayment in full thereof at the rate of 18% per annum (or
such lesser maximum  amount that is permitted to be paid by applicable  law), to
accrue daily from the date such payment is due  hereunder  through and including
the date of payment.  All Debentures  and  Underlying  Shares for which the full
prepayment  price  hereunder  shall have been paid in accordance  herewith shall
promptly be  surrendered  to or as directed by the Company.  The Holder need not
provide and the Company hereby waives any presentment,  demand, protest or other
notice of any kind, and the Holder may immediately and without expiration of any
grace period  enforce any and all of its rights and remedies  hereunder  and all
other remedies  available to it under  applicable  law. Such  declaration may be
rescinded and annulled by Holder at any time prior to payment hereunder. No such
rescission or annulment  shall affect any subsequent  Event of Default or impair
any right consequent thereon.

     Section 4.     Conversion.

          (a) (i)  Conversion  at Option of Holder.  Beginning  on the 151st day
after the Original Issue Date, this Debenture  shall be convertible  into shares
of Common Stock at the option of the Holder, in whole or in part at any time and
from time to time,  provided,  that a Holder may not convert in excess of 16.66%
of the  Debentures  issued to it on the  Original  Issue Date during each 15 day
period  commencing  151 days after such  Original  Issue  Date,  (subject to the
limitations  on conversion  set forth in Section  4(a)(iv)  hereof).  The Holder
shall effect  conversions at its option by delivering to the Company the form of
conversion  notice  attached  hereto  as  Exhibit  A  (a  "Conversion  Notice"),
specifying  therein the  principal  amount of Debentures to be converted and the
date on which such conversion is to be effected,  which date may not be prior to
the date such  Conversion  Notice is deemed to have been delivered  hereunder (a
"Conversion Date") and shall contain a schedule in the form of Schedule 1 to the
Conversion   Notice  (as  amended  on  each  Conversion  Date,  the  "Conversion
Schedule")  reflecting the remaining  principal amount of this Debenture and all
accrued and unpaid interest thereon subsequent to the conversion at issue. If no
Conversion Date is specified in a Conversion  Notice,  the Conversion Date shall
be the date that such Conversion Notice is deemed delivered  hereunder.  Subject
to Section 4(b), each Conversion Notice,  once given,  shall be irrevocable.  To
effect  conversions  hereunder,  the Holder shall not be required to  physically
surrender this Debenture to the Company unless the aggregate principal amount of
this Debenture is so converted.  Conversions  hereunder shall have the effect of
lowering the outstanding principal amount of this Debenture plus all accrued and
unpaid interest thereon in an amount equal to the applicable  conversion,  which
shall be evidenced by entries set forth in the Conversion  Schedule.  The Holder
and the Company shall maintain  records showing the principal  amount  converted
and the date of such  conversions.  In the event of any dispute or  discrepancy,
the records of the Holder shall be controlling and  determinative in the absence
of manifest error. The Holder and any assignee, by acceptance of this Debenture,
acknowledge  and agree  that,  by reason of the  provisions  of this  paragraph,
following conversion of a portion of this Debenture,  the unpaid and unconverted
principal  amount of this  Debenture  may be less than the amount  stated on the
face hereof.
<PAGE>

               (B) Notwithstanding anything to the contrary contained herein, if
on any Conversion Date:


          (1) after the  Interest  Effectiveness  Date (as defined in Section 6)
     such shares of Common Stock (x) are not registered  for resale  pursuant to
     an effective  Underlying Shares  Registration  Statement and (y) may not be
     sold without volume restrictions  pursuant to Rule 144(k) promulgated under
     the Securities Act (as defined in Section 6);

          (2) the  Common  Stock is not  listed or quoted on the  NASDAQ or on a
     Subsequent Market;

          (3)  the  Company  has  failed  to  timely   satisfy  its   conversion
     obligations hereunder; or

          (4) the  issuance  of such shares of Common  Stock  would  result in a
     violation of Section 4(a)(ii),

               then,  at the  option  of the  Holder,  the  Company,  in lieu of
delivering  shares of Common  Stock  pursuant to Section  4(a)(i)(A)(ii),  shall
deliver, within three Trading Days of each applicable Conversion Date, an amount
in cash equal to the  product  of (a) the  outstanding  principal  amount of the
Debentures  to be converted on such  Conversion  Date and (b) the product of (x)
the  quotient  obtained  by  dividing  .06 by 360 and (y) the number of days for
which such principal amount was outstanding.

          (ii) Number of Underlying Shares Issuable Upon Conversion.

          The  number  of  shares of Common  Stock  issuable  upon a  conversion
hereunder shall be determined by adding the sum of (i) the quotient  obtained by
dividing (x) the outstanding  principal amount of this Debenture to be converted
and (y) the Conversion Price (as defined  herein),  and (ii) the amount equal to
(I) the product of (x) the outstanding  principal amount of this Debenture to be
converted  and (y) the product of (1) the  quotient  obtained by dividing .06 by
360 and (2) the number of days for which such principal  amount was outstanding,
divided by (II) the Conversion Price on the Conversion Date,  provided,  that if
the Company  shall have elected and is  permitted  hereunder to pay the interest
due on a Conversion  Date in cash pursuant to the terms hereof,  subsection (ii)
shall not be used in the  calculation  of the  number of shares of Common  Stock
issuable upon a conversion hereunder.
<PAGE>

          (iii) Certain Conversion Restrictions.

                    (A) A Holder may not convert Debentures or receive shares of
Common Stock as payment of interest  hereunder to the extent such  conversion or
receipt of such interest  payment would result in the Holder,  together with any
affiliate thereof, beneficially owning (as determined in accordance with Section
13(d) of the Exchange  Act and the rules  promulgated  thereunder)  in excess of
4.999% of the then  issued and  outstanding  shares of Common  Stock,  including
shares  issuable upon  conversion of, and payment of interest on, the Debentures
held by such Holder after application of this Section. Since the Holder will not
be  obligated  to report to the Company the number of shares of Common  Stock it
may hold at the time of a conversion  hereunder,  unless the conversion at issue
would  result in the  issuance of shares of Common  Stock in excess of 4.999% of
the then  outstanding  shares of Common Stock without regard to any other shares
which may be  beneficially  owned by the  Holder or an  affiliate  thereof,  the
Holder  shall  have the  authority  and  obligation  to  determine  whether  the
restriction  contained  in this  Section  will limit any  particular  conversion
hereunder  and to the extent  that the  Holder  determines  that the  limitation
contained in this Section  applies,  the  determination  of which portion of the
principal amount of Debentures are convertible shall be the  responsibility  and
obligation of the Holder.  If the Holder has delivered a Conversion Notice for a
principal amount of Debentures that, without regard to any other shares that the
Holder or its affiliates may  beneficially  own, would result in the issuance in
excess of the permitted amount hereunder, the Company shall notify the Holder of
this fact and shall  honor  the  conversion  for the  maximum  principal  amount
permitted to be converted on such Conversion Date in accordance with the periods
described  in Section 4(b) and, at the option of the Holder,  either  retain any
principal  amount  tendered for  conversion  in excess of the  permitted  amount
hereunder for future  conversions or return such excess  principal amount to the
Holder. The provisions of this Section may be waived by a Holder (but only as to
itself and not to any other  Holder)  upon not less than 61 days prior notice to
the Company. Other Holders shall be unaffected by any such waiver.

                    (B) A Holder may not convert Debentures or receive shares of
Common Stock as payment of interest  hereunder to the extent such  conversion or
receipt of such interest  payment would result in the Holder,  together with any
affiliate thereof, beneficially owning (as determined in accordance with Section
13(d) of the Exchange  Act and the rules  promulgated  thereunder)  in excess of
9.999% of the then  issued and  outstanding  shares of Common  Stock,  including
shares  issuable upon  conversion of, and payment of interest on, the Debentures
held by such Holder after application of this Section. Since the Holder will not
be  obligated  to report to the Company the number of shares of Common  Stock it
may hold at the time of a conversion  hereunder,  unless the conversion at issue
would  result in the  issuance of shares of Common  Stock in excess of 9.999% of
the then  outstanding  shares of Common Stock without regard to any other shares
which may be  beneficially  owned by the  Holder or an  affiliate  thereof,  the
Holder  shall  have the  authority  and  obligation  to  determine  whether  the
restriction  contained  in this  Section  will limit any  particular  conversion
hereunder  and to the extent  that the  Holder  determines  that the  limitation
contained in this Section  applies,  the  determination  of which portion of the
principal amount of Debentures are convertible shall be the  responsibility  and
obligation of the Holder.  If the Holder has delivered a Conversion Notice for a
principal amount of Debentures that, without regard to any other shares that the
Holder or its affiliates may  beneficially  own, would result in the issuance in

<PAGE>

excess of the permitted amount hereunder, the Company shall notify the Holder of
this fact and shall  honor  the  conversion  for the  maximum  principal  amount
permitted to be converted on such Conversion Date in accordance with the periods
described  in Section 4(b) and, at the option of the Holder,  either  retain any
principal  amount  tendered for  conversion  in excess of the  permitted  amount
hereunder for future  conversions or return such excess  principal amount to the
Holder. The provisions of this Section may be waived by a Holder (but only as to
itself and not to any other  Holder)  upon not less than 61 days prior notice to
the Company. Other Holders shall be unaffected by any such waiver.

               (C) If the Common  Stock is then listed for trading on the NASDAQ
or the Nasdaq  National  Market and the Company has not obtained the Shareholder
Approval  (as  defined  below),  then the  Company may not issue in excess of an
aggregate of  4,384,000  shares of Common  Stock  (which  equals  19.999% of the
number of shares of Common  Stock  outstanding  on the Trading  Day  immediately
preceding the Original  Closing Date) upon  conversions  of the  Debentures at a
price  per  share  that is less  than  the  Closing  Price  on the  Trading  Day
immediately  preceding  the  Original  Issue  Date (such  number of shares,  the
"Issuable Maximum").  Each Holder shall be entitled to a portion of the Issuable
Maximum equal to the quotient  obtained by dividing (x) the aggregate  principal
amount of the  Debentures  issued and sold to such Holder on the Original  Issue
Date by (y) the number of the  Debenture  issued and sold by the  Company on the
Original Issue Date. If any Holder shall no longer hold the Debenture, then such
Holder's  remaining portion of the Issuable Maximum shall be allocated  pro-rata
among the remaining Holders.  If on any Conversion Date (A) the shares of Common
Stock are listed for trading on the NASDAQ or Nasdaq  National  Market,  (B) the
Conversion  Price then in effect is such that the aggregate  number of shares of
Common  Stock that would then be issuable  upon  conversion  in full of all then
outstanding  Debentures,  together  with any shares of Common  Stock  previously
issued upon conversion of the Debenture would exceed the Issuable  Maximum,  and
(C) the Company shall not have previously obtained the vote of shareholders (the
"Shareholder Approval"),  if any, as may be required by the applicable rules and
regulations  of the NASDAQ (or any successor  entity)  applicable to approve the
issuance of shares of Common Stock in excess of the Issuable Maximum pursuant to
the terms  hereof,  then the  Company  shall  issue to the Holder  requesting  a
conversion  a number of shares of Common Stock equal to such  Holder's  pro-rata
portion (which shall be calculated pursuant to the terms hereof) of the Issuable
Maximum and, with respect to the remainder of the aggregate  principal amount of
the  Debentures  then held by such Holder for which a conversion  in  accordance
with the Conversion  Price would result in an issuance of shares of Common Stock
in excess of such Holder's pro-rata portion (which shall be calculated  pursuant
to the terms  hereof) of the  Issuable  Maximum (the  "Excess  Principal"),  the
Company shall,  within five Business Days of such Conversion  Date,  redeem such
Excess  Principal at a price equal to the Mandatory  Prepayment  Amount.  If the
Company  fails to pay such  amount  in full  within  seven  days  after the date
payable,  the Company  will pay  interest  thereon at a rate of 18% per annum or
such lesser  maximum  amount that is permitted to be paid by applicable  law, to
the  converting  Holder,  accruing  daily  from the  Conversion  Date until such
amount, plus all such interest thereon, is paid in full.
<PAGE>

          (b) (i) Not later than five  Trading Days after any  Conversion  Date,
the Company will deliver to the Holder (i) a certificate or  certificates  which
shall be free of restrictive legends and trading  restrictions (other than those
required by Section 3.1(b) of the Purchase Agreement) representing the number of
shares of Common Stock being acquired upon the  conversion of  Debentures,  (ii)
Debentures in a principal amount equal to the principal amount of Debentures not
converted,  and (iii) a bank check for cash in the amount of accrued  and unpaid
interest  for the  principal  amount of  Debentures  converted  pursuant  to the
Conversion  Notice (if the  Company  has timely  elected or is  required  to pay
accrued  interest in cash).  The Company shall,  upon request of the Holder,  if
available,  use its best  efforts to deliver  any  certificate  or  certificates
required  to be  delivered  by the  Company  under this  Section  electronically
through  the  Depository  Trust  Corporation  or  another  established  clearing
corporation  performing  similar  functions.  If in the  case of any  Conversion
Notice such  certificate or certificates  are not delivered to or as directed by
the  applicable  Holder by the fifth  Trading Day after a Conversion  Date,  the
Holder  shall be  entitled  by written  notice to the  Company at any time on or
before its receipt of such  certificate or certificates  thereafter,  to rescind
such  conversion,  in which  event the  Company  shall  immediately  return  the
certificates  representing  the  principal  amount of  Debentures  tendered  for
conversion.

                    (ii) If the  Company  fails to deliver  to the  Holder  such
certificate or certificates pursuant to Section 4(b)(i) by the fifth Trading Day
after the  Conversion  Date,  the Company shall pay to such Holder,  in cash, as
liquidated damages and not as a penalty, 1% of the aggregate principal amount of
the Debentures converted (plus accrued interest) for each Trading Day after such
fifth Trading Day until such  certificates  are delivered.  Nothing herein shall
limit a Holder's  right to pursue actual  damages or declare an Event of Default
pursuant to Section 3 herein for the Company's  failure to deliver  certificates
representing  shares of Common Stock upon conversion within the period specified
herein and such Holder shall have the right to pursue all remedies  available to
it at law or in equity  including,  without  limitation,  a decree  of  specific
performance  and/or injunctive relief. The exercise of any such rights shall not
prohibit  the  Holders  from  seeking to enforce  damages  pursuant to any other
Section hereof or under applicable law.  Further,  if the Company shall not have
delivered any cash due in respect of  conversions of Debentures or as payment of
interest  thereon by the fifth Trading Day after the Conversion Date, the Holder
may, by notice to the  Company,  require  the Company to issue  shares of Common
Stock  pursuant to Section  4(c),  except that for such  purpose the  Conversion
Price  applicable  thereto  shall be the lesser of the  Conversion  Price on the
Conversion Date and the Conversion Price on the date of such Holder demand.  Any
such shares will be subject to the provision of this Section.

                    (iii) In  addition  to any  other  rights  available  to the
Holder,  if the  Company  fails to  deliver to the Holder  such  certificate  or
certificates  pursuant  to Section  4(b)(i) by the fifth  Trading  Day after the
Conversion Date, and if after such fifth Trading Day the Holder purchases (in an
open market transaction or otherwise) Common Stock to deliver in satisfaction of
a sale by such  Holder of the  Underlying  Shares  which the Holder  anticipated
receiving upon such  conversion (a "Buy-In"),  then the Company shall (A) pay in
cash to the Holder (in addition to any  remedies  available to or elected by the
Holder) the amount by which (x) the Holder's  total  purchase  price  (including
brokerage commissions, if any) for the Common Stock so purchased exceeds (y) the
product of (1) the  aggregate  number of shares of Common Stock that such Holder
anticipated  receiving from the conversion at issue multiplied by (2) the market
price of the Common  Stock at the time of the sale giving rise to such  purchase

<PAGE>

obligation  and (B) at the option of the Holder,  either  reissue  Debentures in
principal  amount equal to the principal  amount of the attempted  conversion or
deliver to the Holder the number of shares of Common  Stock that would have been
issued had the Company  timely  complied  with its delivery  requirements  under
Section  4(b)(i).  For example,  if the Holder  purchases  Common Stock having a
total  purchase  price of $11,000 to cover a Buy-In with respect to an attempted
conversion  of  Debentures  with  respect  to  which  the  market  price  of the
Underlying  Shares on the date of conversion was a total of $10,000 under clause
(A) of the immediately preceding sentence,  the Company shall be required to pay
the  Holder  $1,000.  The  Holder  shall  provide  the  Company  written  notice
indicating  the  amounts  payable  to the  Holder  in  respect  of  the  Buy-In.
Notwithstanding  anything contained herein to the contrary, if a Holder requires
the  Company to make  payment  in respect of a Buy-In for the  failure to timely
deliver certificates hereunder and the Company timely pays in full such payment,
the Company  shall not be required to pay such Holder  liquidated  damages under
Section 4(b)(ii) in respect of the certificates resulting in such Buy-In.

          (c) (i) The conversion price (the "Conversion Price") in effect on any
Conversion  Date  shall be the  lesser of (1)  $0.90  (the  "Initial  Conversion
Price"),  and (2) 82% of the average of the Per Share Market Values for the five
Trading  Days  (which need not occur on  consecutive  Trading  Days)  during the
twenty Trading Days immediately  preceding the applicable Conversion Date (which
may include Trading Days prior to the Original Issue Date), provided,  that such
twenty  Trading Day period shall,  at the option of the Holder,  be extended for
the number of Trading Days during such period in which (A) trading in the Common
Stock is suspended  by, or not traded on, the NASDAQ or a  Subsequent  Market on
which the Common Stock is then listed, or (B) after the date declared  effective
by the Commission,  the Underlying Shares  Registration  Statement is either not
effective  or the  Prospectus  included in the  Underlying  Shares  Registration
Statement may not be used by the Holder for the resale of Underlying Shares.

                    (ii) If the Company, at any time while any Debentures are
outstanding,  (a) shall pay a stock dividend or otherwise make a distribution or
distributions  on  shares  of its  Common  Stock or any  other  equity or equity
equivalent   securities  payable  in  shares  of  Common  Stock,  (b)  subdivide
outstanding  shares of Common Stock into a larger number of shares,  (c) combine
(including  by way of reverse  stock split)  outstanding  shares of Common Stock
into a smaller number of shares, or (d) issue by  reclassification  of shares of
the Common Stock any shares of capital  stock of the  Company,  then the Initial
Conversion  Price shall be multiplied by a fraction of which the numerator shall
be the number of shares of Common  Stock  (excluding  treasury  shares,  if any)
outstanding  before such event and of which the denominator  shall be the number
of shares of Common Stock  outstanding  after such event.  Any  adjustment  made
pursuant to this Section  shall become  effective  immediately  after the record
date for the determination of stockholders  entitled to receive such dividend or
distribution and shall become effective  immediately after the effective date in
the case of a subdivision, combination or re-classification.

                    (iii) If the Company,  at any time while any  Debentures are
outstanding,  shall issue  rights,  options or warrants to all holders of Common
Stock (and not to Holders) entitling them to subscribe for or purchase shares of
Common  Stock at a price per share less than the Per Share  Market  Value at the
record date mentioned below,  then the Conversion Price shall be multiplied by a

<PAGE>

fraction,  of which the denominator  shall be the number of shares of the Common
Stock (excluding treasury shares, if any) outstanding on the date of issuance of
such rights or warrants  plus the number of  additional  shares of Common  Stock
offered for  subscription  or purchase,  and of which the numerator shall be the
number  of  shares of the  Common  Stock  (excluding  treasury  shares,  if any)
outstanding  on the date of issuance of such rights or warrants  plus the number
of shares which the  aggregate  offering  price of the total number of shares so
offered would purchase at such Per Share Market Value.  Such adjustment shall be
made  whenever  such rights or warrants are issued,  and shall become  effective
immediately after the record date for the determination of stockholders entitled
to receive such rights, options or warrants. However, upon the expiration of any
such  right,  option or  warrant  to  purchase  shares of the  Common  Stock the
issuance of which resulted in an adjustment in the Conversion  Price pursuant to
this  Section,  if any such right,  option or warrant shall expire and shall not
have been exercised, the Conversion Price shall immediately upon such expiration
be recomputed and effective immediately upon such expiration be increased to the
price  which it would have been (but  reflecting  any other  adjustments  in the
Conversion  Price made  pursuant to the  provisions  of this  Section  after the
issuance of such rights or warrants) had the adjustment of the Conversion  Price
made upon the  issuance of such  rights,  options or  warrants  been made on the
basis of offering for subscription or purchase only that number of shares of the
Common Stock  actually  purchased  upon the exercise of such rights,  options or
warrants actually exercised.

                    (iv) If the Company or any subsidiary thereof, as applicable
with respect to Common Stock  Equivalents (as defined below),  at any time while
Debentures  are  outstanding,  shall  issue  shares of Common  Stock or  rights,
warrants (including those issued under the Purchase Agreement), options or other
securities or debt that is convertible into or exchangeable for shares of Common
Stock  ("Common  Stock  Equivalents")  entitling any Person to acquire shares of
Common Stock, at a price per share less than the Conversion Price (if the holder
of the Common  Stock or Common  Stock  Equivalent  so issued  shall at any time,
whether by operation of purchase price adjustments,  reset provisions,  floating
conversion,  exercise  or  exchange  prices or  otherwise,  or due to  warrants,
options or rights  issued in  connection  with such  issuance,  be  entitled  to
receive shares of Common Stock at a price less than the Conversion  Price,  such
issuance shall be deemed to have occurred for less than the  Conversion  Price),
then, at the option of the Holder,  the Conversion  Price shall be replaced with
the conversion, exchange or purchase price for such Common Stock or Common Stock
Equivalents   (including  any  reset  provisions  thereof)  for  all  subsequent
conversions  of  Debentures  or such  conversions  as shall be  indicated by the
Holder on its Conversion  Notice.  Such  adjustment  shall be made whenever such
Common Stock or Common Stock  Equivalents  are issued.  The Company shall notify
the Holder and the  Escrow  Agent in  writing,  no later  than the  Trading  Day
following the issuance of any Common Stock or Common Stock Equivalent subject to
this section, indicating therein the applicable issuance price, or of applicable
reset  price,  exchange  price,   conversion  price  and  other  pricing  terms.
Notwithstanding  the  foregoing  no  adjustment  will be made under this Section
4(c)(iv)  as a  result  of the  granting  of  stock  options  to  employees  and
consultants  in the Company,  or the issuance of shares of Common Stock upon the
exercise  of such  stock  options,  pursuant  to  option  plans in effect on the
Original Issue Date or thereafter adopted by the Company.
<PAGE>

                    (v) If  the  Company,  at  any  time  while  Debentures  are
outstanding,  shall  distribute  to all  holders  of  Common  Stock  (and not to
Holders)  evidences  of its  indebtedness  or assets or  rights or  warrants  to
subscribe  for or purchase any security,  then in each such case the  Conversion
Price at which Debentures shall thereafter be convertible shall be determined by
multiplying the Conversion Price in effect  immediately prior to the record date
fixed for determination of stockholders entitled to receive such distribution by
a  fraction  of which  the  denominator  shall  be the Per  Share  Market  Value
determined  as of the record date  mentioned  above,  and of which the numerator
shall be such Per  Share  Market  Value on such  record  date less the then fair
market  value at such  record  date of the portion of such assets or evidence of
indebtedness so distributed  applicable to one  outstanding  share of the Common
Stock as determined by the Board of Directors in good faith.  In either case the
adjustments  shall be  described  in a statement  provided to the Holders of the
portion  of  assets  or  evidences  of   indebtedness  so  distributed  or  such
subscription  rights  applicable to one share of Common Stock.  Such  adjustment
shall be made whenever any such  distribution is made and shall become effective
immediately after the record date mentioned above.

                    (vi) In case of any  reclassification of the Common Stock or
any compulsory  share  exchange  pursuant to which the Common Stock is converted
into  other  securities,  cash or  property,  the  Holders  shall have the right
thereafter  to, at their  option,  (A)  convert the then  outstanding  principal
amount, together with all accrued but unpaid interest and any other amounts then
owing  hereunder in respect of this  Debenture only into the shares of stock and
other  securities,  cash and  property  receivable  upon or deemed to be held by
holders of the Common Stock following such  reclassification  or share exchange,
and the Holders of the  Debentures  shall be entitled upon such event to receive
such amount of securities, cash or property as the shares of the Common Stock of
the Company into which the then outstanding principal amount,  together with all
accrued  but unpaid  interest  and any other  amounts  then owing  hereunder  in
respect of this Debenture  could have been converted  immediately  prior to such
reclassification  or share  exchange would have been entitled or (B) require the
Company  to  prepay  the  aggregate  of  its  outstanding  principal  amount  of
Debentures,  plus all interest and other amounts due and payable  thereon,  at a
price  determined in accordance with Section 3(b). The entire  prepayment  price
shall  be paid in cash.  This  provision  shall  similarly  apply to  successive
reclassifications or share exchanges.

                    (vii) All calculations under this Section 4 shall be made to
the  nearest  cent or the  nearest  1/100th  of a share,  as the case may be. No
adjustments in either the Conversion Price or the Initial Conversion Price shall
be required if such adjustment is less than $0.01,  provided,  however, that any
adjustments which by reason of this Section are not required to be made shall be
carried forward and taken into account in any subsequent adjustment.

                    (viii) Whenever either the Initial  Conversion  Price or the
Conversion  Price is  adjusted  pursuant to any of Section  4(c)(ii) - (v),  the
Company shall  promptly  mail to each Holder a notice  setting forth the Initial
Conversion Price or Conversion  Price (as applicable)  after such adjustment and
setting forth a brief statement of the facts requiring such adjustment.
<PAGE>

                    (ix) If (A) the  Company  shall  declare a dividend  (or any
other distribution) on the Common Stock; (B) the Company shall declare a special
nonrecurring  cash  dividend on or a  redemption  of the Common  Stock;  (C) the
Company  shall  authorize the granting to all holders of the Common Stock rights
or warrants to  subscribe  for or  purchase  any shares of capital  stock of any
class or of any  rights;  (D) the  approval of any  stockholders  of the Company
shall be required in connection with any  reclassification  of the Common Stock,
any  consolidation  or  merger  to which  the  Company  is a party,  any sale or
transfer  of all or  substantially  all of the  assets  of the  Company,  of any
compulsory  share  exchange  whereby the Common  Stock is  converted  into other
securities,  cash or property;  (E) the Company shall authorize the voluntary or
involuntary  dissolution,  liquidation  or  winding  up of  the  affairs  of the
Company;  then, in each case, the Company shall cause to be filed at each office
or agency maintained for the purpose of conversion of the Debentures,  and shall
cause to be mailed to the Holders at their last  addresses  as they shall appear
upon the stock  books of the  Company,  at least 20  calendar  days prior to the
applicable record or effective date hereinafter  specified, a notice stating (x)
the date on which a record  is to be taken  for the  purpose  of such  dividend,
distribution, redemption, rights or warrants, or if a record is not to be taken,
the date as of which the holders of the Common Stock of record to be entitled to
such  dividend,  distributions,   redemption,  rights  or  warrants  are  to  be
determined  or (y)  the  date on  which  such  reclassification,  consolidation,
merger,  sale,  transfer or share  exchange is expected to become  effective  or
close,  and the date as of which it is expected that holders of the Common Stock
of record  shall be entitled to exchange  their  shares of the Common  Stock for
securities,  cash or other  property  deliverable  upon  such  reclassification,
consolidation,  merger,  sale,  transfer or share exchange,  provided,  that the
failure to mail such  notice or any defect  therein  or in the  mailing  thereof
shall not affect the validity of the corporate  action  required to be specified
in such  notice.  Holders are entitled to convert  Debentures  during the 20-day
period  commencing  the date of such notice to the  effective  date of the event
triggering such notice.

                    (x) In  case  of any  (1)  merger  or  consolidation  of the
Company  with or into  another  Person,  or (2) sale by the Company of more than
one-half of the assets of the Company (on an as valued basis) in one or a series
of related transactions, a Holder shall have the right to (A) if permitted under
Section 3(b) hereof,  exercise its rights of prepayment  under Section 3(b) with
respect to such event, (B) convert its aggregate  principal amount of Debentures
then  outstanding  into the  shares  of stock  and  other  securities,  cash and
property  receivable  upon or  deemed  to be held by  holders  of  Common  Stock
following such merger,  consolidation or sale, and such Holder shall be entitled
upon  such  event or  series  of  related  events  to  receive  such  amount  of
securities,  cash and  property  as the  shares of Common  Stock into which such
aggregate  principal amount of Debentures could have been converted  immediately
prior to such merger, consolidation or sales would have been entitled, or (C) in
the case of a merger or consolidation, (x) require the surviving entity to issue
convertible  debentures in an aggregate  principal amount equal to the aggregate
principal  amount of Debentures  then held by such Holder,  plus all accrued and
unpaid interest and other amounts owing thereon,  which newly issued convertible

<PAGE>

debentures shall have terms identical  (including with respect to conversion) to
the terms of this  Debenture  and shall be  entitled  to all of the  rights  and
privileges  of a Holder  of  Debentures  set  forth  herein  and the  agreements
pursuant to which the Debentures were issued (including,  without limitation, as
such rights relate to the acquisition, transferability, registration and listing
of such shares of stock other securities issuable upon conversion thereof),  and
(y) simultaneously with the issuance of such convertible debentures,  shall have
the  right to  convert  such  instrument  only  into  shares  of stock and other
securities, cash and property receivable upon or deemed to be held by holders of
Common Stock following such merger or consolidation.  In the case of clause (C),
the  conversion  price  applicable for the newly issued  convertible  debentures
shall be based upon the amount of securities,  cash and property that each share
of Common Stock would receive in such  transaction  and the Conversion  Price in
effect  immediately  prior  to  the  effectiveness  or  closing  date  for  such
transaction.  The terms of any such merger,  sale or consolidation shall include
such  terms so as to  continue  to give the  Holders  the right to  receive  the
securities,  cash and property set forth in this Section upon any  conversion or
redemption  following  such  event.  This  provision  shall  similarly  apply to
successive such events.

          (d) Upon a conversion  hereunder  the Company shall not be required to
issue stock certificates  representing  fractions of shares of the Common Stock,
but may if  otherwise  permitted,  make a cash  payment  in respect of any final
fraction of a share  based on the Per Share  Market  Value at such time.  If the
Company elects not, or is unable, to make such a cash payment,  the Holder shall
be  entitled  to receive,  in lieu of the final  fraction of a share,  one whole
share of Common Stock.

          (e) The  issuance of  certificates  for shares of the Common  Stock on
conversion of the Debentures shall be made without charge to the Holders thereof
for any documentary stamp or similar taxes that may be payable in respect of the
issue or delivery of such  certificate,  provided  that the Company shall not be
required to pay any tax that may be payable in respect of any transfer  involved
in the issuance and delivery of any such  certificate  upon conversion in a name
other than that of the Holder of such  Debentures  so converted  and the Company
shall not be required to issue or deliver such certificates  unless or until the
person or persons requesting the issuance thereof shall have paid to the Company
the  amount of such tax or shall have  established  to the  satisfaction  of the
Company that such tax has been paid.

          (f) Any and all notices or other  communications  or  deliveries to be
provided by the Holders hereunder, including, without limitation, any Conversion
Notice, shall be in writing and delivered  personally,  by facsimile,  sent by a
nationally  recognized  overnight  courier  service  or  sent  by  certified  or
registered mail, postage prepaid, addressed to the Company, at 88 Orville Drive,
Bohemia,  New York,  11716,  Facsimile  No.:  (631)  563-8085,  attention  Chief
Financial Officer,  or such other address or facsimile number as the Company may
specify for such purposes by notice to the Holders  delivered in accordance with
this Section.  Any and all notices or other  communications  or deliveries to be
provided by the Company hereunder shall be in writing and delivered  personally,
by facsimile,  sent by a nationally recognized overnight courier service or sent
by certified or registered mail,  postage  prepaid,  addressed to each Holder at
the facsimile  telephone number or address of such Holder appearing on the books
of the Company,  or if no such facsimile telephone number or address appears, at
the principal place of business of the Holder. Any notice or other communication
or deliveries  hereunder  shall be deemed given and effective on the earliest of
(i) the date of  transmission,  if such notice or communication is delivered via
facsimile at the facsimile  telephone  number specified in this Section prior to
6:30 p.m. (New York City time), (ii) the date after the date of transmission, if
such  notice or  communication  is  delivered  via  facsimile  at the  facsimile
telephone  number  specified in this Section later than 6:30 p.m. (New York City

<PAGE>

time) on any date and earlier than 11:59 p.m. (New York City time) on such date,
(iii) four days after deposit in the United  States mail,  (iv) the Business Day
following  the  date of  mailing,  if sent by  nationally  recognized  overnight
courier service,  or (v) upon actual receipt by the party to whom such notice is
required to be given.

     Section 5.     Optional Prepayment.

          (a) The Company shall have the right, exercisable at any time and from
time to time after the  Original  Issue Date and upon five  Trading  Days' prior
written notice to the affected  Holders (an "Optional  Prepayment  Notice"),  to
prepay all or any portion of the outstanding  principal amount of the Debentures
for which Conversion Notices have not previously been delivered.  The prepayment
price  applicable  to  prepayments  under  this  Section  5(a)  shall  equal the
Mandatory Prepayment Amount and shall be paid in cash on the seventh Trading Day
following  the date that the Company  first  delivered  the Optional  Prepayment
Notice (the "Optional  Prepayment  Date").  Any such prepayment shall be free of
any claim of subordination.

          (b) If any portion of the  Prepayment  Amount shall not be paid by the
Company by the expiration of the Optional  Prepayment  Date, the Company may not
again  exercise any right of  prepayment  under this Section.  In addition,  the
Mandatory  Prepayment Amount shall be increased by 18% per annum (or such lesser
maximum  amount that is permitted to be paid by applicable  law) to accrue daily
from the date such interest is due  hereunder  through and including the date of
payment (which amount shall be paid as liquidated damages and not as a penalty).
In addition,  if any portion of the Mandatory  Prepayment  Amount remains unpaid
through the  expiration of the Optional  Prepayment  Date, the Holder subject to
such  prepayment may elect by written notice to the Company to either (x) demand
conversion in accordance with the formula and the time period therefor set forth
in Section 4 of any portion of the principal  amount of Debentures for which the
Mandatory  Prepayment  Amount,  plus  accrued  liquidated  damages  and  accrued
interest thereon,  has not been paid in full (the "Unpaid  Prepayment  Principal
Amount"),  in which event the  applicable  Per Share  Market  Value shall be the
lower of the Per Share Market Value  calculated on the Optional  Prepayment Date
and the Per Share Market Value as of the Holder's written demand for conversion,
or (y) invalidate ab initio such optional prepayment,  notwithstanding  anything
herein  contained to the contrary.  If the Holder  elects option (x) above,  the
Company shall,  within five Trading Days after such election is deemed delivered
hereunder,  deliver  to the  Holder the  shares of Common  Stock  issuable  upon
conversion of the Unpaid Prepayment  Principal Amount subject to such conversion
demand and otherwise perform its obligations hereunder with respect thereto.

     Section 6 Definitions.  For the purposes hereof,  the following terms shall
have the following meanings:

          "Business Day" means any day except Saturday, Sunday and any day which
shall be a federal  legal holiday in the United States or a day on which banking
institutions in the State of New York are authorized or required by law or other
government action to close.
<PAGE>
          "Change of Control  Transaction" means the occurrence of any of (i) an
acquisition  after the date hereof by an  individual  or legal entity or "group"
(as  described  in Rule  13d-5(b)(1)  promulgated  under  the  Exchange  Act) of
effective  control  (whether  through legal or  beneficial  ownership of capital
stock of the  Company,  by  contract  or  otherwise)  of in excess of 33% of the
voting securities of the Company, (ii) a replacement at one time or over time of
more than one-half of the members of the Company's  board of directors  which is
not approved by a majority of those  individuals who are members of the board of
directors on the date hereof (or by those individuals who are serving as members
of the board of directors on any date whose nomination to the board of directors
was  approved  by a majority of the  members of the board of  directors  who are
members  on the date  hereof),  (iii)  the  merger of the  Company  with or into
another entity that is not wholly-owned by the Company, consolidation or sale of
50% or  more  of the  assets  of the  Company  in  one or a  series  of  related
transactions,  or (iv) the execution by the Company of an agreement to which the
Company is a party or by which it is bound,  providing for any of the events set
forth above in (i), (ii) or (iii).

          "Closing  Price" means on any  particular  date (a) the closing  sales
price per share of Common  Stock on such date on the  NASDAQ or such  Subsequent
Market on which the  shares of Common  Stock are then  listed or  quoted,  or if
there is no such price on such date,  then the closing sales price on the NASDAQ
or such Subsequent Market on the date nearest preceding such date, or (b) if the
shares of  Common  Stock  are not then  listed  or quoted on the  NASDAQ or such
Subsequent  Market,  the closing  sales price for a share of Common Stock in the
Nasdaq Stock Market, as reported by the National  Quotation Bureau  Incorporated
or similar  organization  or agency  succeeding  to its  functions  of reporting
prices) at the close of  business  on such date,  or (c) if the shares of Common
Stock are not then reported by the National  Quotation  Bureau  Incorporated (or
similar organization or agency succeeding to its functions of reporting prices),
then the average of the "Pink Sheet" quotes for the relevant  conversion period,
as determined in good faith by the Holder,  or (d) if the shares of Common Stock
are not then publicly traded the fair market value of a share of Common Stock as
determined  by an Appraiser  selected in good faith by the Holders of a majority
in interest of the principal amount of Debentures then outstanding.

          "Commission" means the Securities and Exchange Commission.

          "Common Stock" means the common stock,  $.0001 par value per share, of
the Company  and stock of any other  class into which such shares may  hereafter
have been reclassified or changed.

          "Exchange Act" means the Securities Exchange Act of 1934, as amended.

          "Mandatory  Prepayment  Amount" for any Debentures shall equal the sum
of (i)130% of the principal amount of Debentures to be prepaid, plus all accrued
and unpaid interest  thereon,  and (ii) all other amounts,  costs,  expenses and
liquidated damages due in respect of such Debentures.
<PAGE>

          "Original Issue Date" shall mean the date of the first issuance of the
Debentures regardless of the number of transfers of any Debenture and regardless
of the number of instruments which may be issued to evidence such Debenture.

          "Per Share Market Value" means on any particular  date (a) the closing
bid  price  per  share of  Common  Stock on such  date on the  NASDAQ or on such
Subsequent Market on which the shares of Common Stock are then listed or quoted,
or if there is no such price on such  date,  then the  closing  bid price on the
NASDAQ or on such Subsequent  Market on the date nearest preceding such date, or
(b) if the shares of Common Stock are not then listed or quoted on the NASDAQ or
a  Subsequent  Market,  the closing bid price for a share of Common Stock in the
over-the-counter   market,   as  reported  by  the  National   Quotation  Bureau
Incorporated or similar  organization  or agency  succeeding to its functions of
reporting prices) at the close of business on such date, or (c) if the shares of
Common Stock are not then reported by the National Quotation Bureau Incorporated
(or similar  organization  or agency  succeeding  to its  functions of reporting
prices), then the average of the "Pink Sheet" quotes for the relevant conversion
period,  as  determined  in good  faith by the  Holder,  or (d) if the shares of
Common  Stock are not then  publicly  traded the fair market value of a share of
Common Stock as determined by an Appraiser selected in good faith by the Holders
of a majority in interest of the principal amount of Notes then outstanding.

          "Person"  means  a  corporation,   an   association,   a  partnership,
organization,  a business, an individual,  a government or political subdivision
thereof or a governmental agency.

          "Purchase   Agreement"  means  the  Convertible   Debenture   Purchase
Agreement, dated as of September 27, 2000, to which the Company and the original
Holder are parties,  as amended,  modified or supplemented  from time to time in
accordance with its terms.

          "Registration   Rights   Agreement"  means  the  Registration   Rights
Agreement, dated as of September 27, 2000, to which the Company and the original
Holder are parties,  as amended,  modified or supplemented  from time to time in
accordance with its terms.

          "Securities Act" means the Securities Act of 1933, as amended.

          "Trading  Day" means (a) a day on which the shares of Common Stock are
traded on the NASDAQ or on such Subsequent  Market on which the shares of Common
Stock are then  listed or quoted,  or (b) if the shares of Common  Stock are not
listed on the NASDAQ or a Subsequent Market, a day on which the shares of Common
Stock are traded in the over-the-counter market, as reported by the OTC Bulletin
Board,  or (c) if the shares of Common  Stock are not quoted on the OTC Bulletin
Board,   a  day  on  which  the  shares  of  Common  Stock  are  quoted  in  the
over-the-counter   market  as  reported  by  the   National   Quotation   Bureau
Incorporated (or any similar  organization or agency succeeding its functions of
reporting prices);  provided,  that in the event that the shares of Common Stock
are not listed or quoted as set forth in (a),  (b) and (c) hereof,  then Trading
Day shall mean any day except a Business Day.
<PAGE>

          "Transaction  Documents"  shall  have  the  meaning  set  forth in the
Purchase Agreement.

          "Underlying  Shares"  means the shares of Common Stock  issuable  upon
conversion of Debentures or as payment of interest in accordance  with the terms
hereof.

          "Underlying  Shares  Registration   Statement"  means  a  registration
statement  meeting  the  requirements  set  forth  in  the  Registration  Rights
Agreement,  covering among other things the resale of the Underlying  Shares and
naming the Holder as a "selling stockholder" thereunder.

     Section 7.  Except as  expressly  provided  herein,  no  provision  of this
Debenture shall alter or impair the obligation of the Company, which is absolute
and unconditional,  to pay the principal of, interest and liquidated damages (if
any) on,  this  Debenture  at the  time,  place,  and  rate,  and in the coin or
currency,  herein  prescribed.  This  Debenture  is a direct  obligation  of the
Company.  This  Debenture  ranks  pari passu  with all other  Debentures  now or
hereafter  issued  under  the  terms  set  forth  herein.  As long as there  are
Debentures  outstanding,  the Company shall not and shall cause it  subsidiaries
not to,  without  the  consent  of the  Holders,  (i) amend its  certificate  of
incorporation,  bylaws or other charter  documents so as to adversely affect any
rights of the Holders; (ii) repay,  repurchase or offer to repay,  repurchase or
otherwise  acquire shares of its Common Stock or other equity  securities  other
than as to the Underlying  Shares to the extent  permitted or required under the
Transaction Documents;  or (iii) enter into any agreement with respect to any of
the foregoing.

     Section 8. This Debenture shall not entitle the Holder to any of the rights
of a stockholder  of the Company,  including  without  limitation,  the right to
vote, to receive dividends and other distributions, or to receive any notice of,
or to attend,  meetings of stockholders or any other proceedings of the Company,
unless and to the extent  converted  into shares of Common  Stock in  accordance
with the terms hereof.

     Section 9. If this Debenture shall be mutilated, lost, stolen or destroyed,
the Company shall execute and deliver, in exchange and substitution for and upon
cancellation of a mutilated  Debenture,  or in lieu of or in substitution  for a
lost, stolen or destroyed debenture, a new Debenture for the principal amount of
this Debenture so mutilated,  lost, stolen or destroyed but only upon receipt of
evidence  of such  loss,  theft or  destruction  of such  Debenture,  and of the
ownership hereof, and indemnity,  if requested,  all reasonably  satisfactory to
the Company.

     Section 10. No  indebtedness  of the Company is senior to this Debenture in
right of payment, whether with respect to interest,  damages or upon liquidation
or dissolution or otherwise. The Company will not and will not permit any of its
subsidiaries to, directly or indirectly,  enter into, create,  incur,  assume or
suffer to exist any  indebtedness  of any kind, on or with respect to any of its
property or assets now owned or hereafter  acquired or any  interest  therein or
any income or profits  therefrom  that is senior in any respect to the Company's
obligations under the Debentures.

     Section 11. This Debenture shall be governed by and construed in accordance
with the laws of the State of New York,  without  giving  effect to conflicts of
laws  thereof.  The Company  and the Holder  hereby  irrevocably  submits to the
exclusive  jurisdiction  of the state and federal  courts sitting in the City of

<PAGE>

New York, Borough of Manhattan, for the adjudication of any dispute hereunder or
in connection herewith or with any transaction  contemplated hereby or discussed
herein,  and hereby  irrevocably  waives,  and agrees not to assert in any suit,
action  or  proceeding,  any  claim  that it is not  personally  subject  to the
jurisdiction  of any such  court,  or that such suit,  action or  proceeding  is
improper.  Each of the Company and the Holder hereby irrevocably waives personal
service of process and consents to process being served in any such suit, action
or  proceeding by receiving a copy thereof sent to the Company at the address in
effect for  notices to it under this  instrument  and agrees  that such  service
shall  constitute  good and  sufficient  service of process and notice  thereof.
Nothing  contained herein shall be deemed to limit in any way any right to serve
process in any manner permitted by law.

     Section  12.  Any  waiver by the  Company  or the Holder of a breach of any
provision of this Debenture  shall not operate as or be construed to be a waiver
of any other breach of such provision or of any breach of any other provision of
this  Debenture.  The failure of the Company or the Holder to insist upon strict
adherence to any term of this  Debenture on one or more  occasions  shall not be
considered a waiver or deprive that party of the right thereafter to insist upon
strict  adherence to that term or any other term of this  Debenture.  Any waiver
must be in writing.

     Section 13. If any  provision  of this  Debenture  is  invalid,  illegal or
unenforceable,  the balance of this Debenture shall remain in effect, and if any
provision is inapplicable to any person or circumstance,  it shall  nevertheless
remain applicable to all other persons and  circumstances.  If it shall be found
that any interest or other amount deemed  interest due  hereunder  shall violate
applicable laws governing  usury,  the applicable rate of interest due hereunder
shall  automatically be lowered to equal the maximum permitted rate of interest.
The Company  covenants  (to the extent that it may lawfully do so) that it shall
not at any time insist upon,  plead, or in any manner  whatsoever  claim or take
the benefit or advantage of, any stay, extension or usury law or other law which
would  prohibit  or forgive  the  Company  from paying all or any portion of the
principal of or interest on the  Debentures  as  contemplated  herein,  wherever
enacted,  now or at any time  hereafter  in  force,  or  which  may  affect  the
covenants or the performance of this  indenture,  and the Company (to the extent
it may lawfully do so) hereby  expressly waives all benefits or advantage of any
such law,  and  covenants  that it will not, by resort to any such law,  hinder,
delay or impeded the  execution of any power herein  granted to the Holder,  but
will  suffer and permit  the  execution  of every such as though no such law has
been enacted.

     Section 14. Whenever any payment or other obligation hereunder shall be due
on a day other  than a  Business  Day,  such  payment  shall be made on the next
succeeding Business Day.



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                             SIGNATURE PAGE FOLLOWS]

<PAGE>


          IN WITNESS WHEREOF, the Company has caused this Convertible  Debenture
to be duly  executed  by a duly  authorized  officer as of the date first  above
indicated.


                         DIRECT INSITE CORPORATION



                         By:
                            ------------------------------------
                           Name:
                           Title:


<PAGE>


                                    EXHIBIT A

                              NOTICE OF CONVERSION


The undersigned  hereby elects to convert the attached  Debenture into shares of
common stock,  $.0001 par value per share (the "Common Stock"), of Direct Insite
Corporation (the "Company")  according to the conditions  hereof, as of the date
written below. If shares are to be issued in the name of a person other than the
undersigned,  the  undersigned  will pay all transfer taxes payable with respect
thereto and is delivering  herewith such certificates and opinions as reasonably
requested by the Company in accordance therewith.  No fee will be charged to the
holder for any conversion, except for such transfer taxes, if any.

Conversion calculations:

                         _______________________________________________________
                         Date to Effect Conversion

                         _______________________________________________________
                         Principal Amount of Debentures to be Converted

                         _______________________________________________________
                         Number of shares of Common Stock to be Issued

                         Payment of Interest in Kind     [ ]  Yes  [ ]  No
                             If yes, $ _______ of Interest Accrued on Account of
                             Conversion at Issue

                         _______________________________________________________
                         Applicable Conversion Price

                         _______________________________________________________
                         Signature

                         _______________________________________________________
                         Name

                         _______________________________________________________
                         Address


<PAGE>

                                   Schedule 1

                               CONVERSION SCHEDULE

 6%  Convertible  Debentures,  due in the  aggregate  principal  amount of up to
$3,000,000  issued  by  Direct  Insite  Corporation.  This  Conversion  Schedule
reflects  conversions  made  under  Section  4(a)(i)  of  the  above  referenced
Debentures.

                             Dated:



                             Amount of        Aggregate
Date of Conversion           Conversion       Principal
                                              Amount
                                              Remaining
                                              Subsequent to
                                              Conversion
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